Following a tabled report at a meeting held on 30 July, the city has assured that measures have been put in place to reduce irregular expenditure in the city. The report outlined irregular expenditure incurred during the 2018/19 financial year.
According to the eThekwini ‘s acting communication head, Mandla Nsele, there has been a decrease of almost R151 million in irregular expenditure in 2018/19 compared to the 2017/18 financial year. “The tabled report noted that irregular expenditure, which is a result of non-compliance with supply chain management policy, was R581 492 759.38 for the 2018/19 financial year. Included in this amount is R138 272 435.63 relating to the previous financial years (prior to 2018/19) and R443 220 323.75 relating to the 2018/19 financial year. Irregular expenditure in the city was R733 million in the 2017/18 financial year.”
Nsele said it was noted during the meeting that goods and services were received and that value for money was received for the irregular expenditure incurred. ” While there has been a noted decrease in irregular expenditure, the city has implemented measures to further reduce it. This includes the city’s process to address unauthorised, irregular, fruitless and wasteful expenditure which is currently being aligned to the amended Municipal Finance Management Act (MFMA) Circular 68, the report states. Once finalised, relevant reports will be submitted to the respective stakeholders as prescribed, including council.”
He said the report notes that a parallel process has been initiated to analyse all unauthorised, irregular, fruitless and wasteful expenditure, including amounts brought forward from the prior year. “The report further states that based on the outcome of the analysis and the respective status of each item, the appropriate process will be followed to address this expenditure in line with the requirements of Section 32 of the MFMA and the amended MFMA Circular 68,” said Nsele
He said the report further recommended that depending on the outcome of investigations by line departments, the City Integrity and Investigations Unit (CIIU) and the Municipal Public Accounts Committee, further action may arise including disciplinary action, recovery of monies and criminal charges being instituted where applicable.
Acting eThekwini Mayor Fawzia Peer said there was political will to ensure irregular expenditure did not increase in the city. “I am happy that goods and services were delivered for this money. Irregular expenditure is very different from wasteful and fruitless expenditure. However, I encourage departments to plan in advance especially when contracts are expiring to avoid irregular expenditure,” said acting Mayor Peer.
She further reiterated the city’s commitment to good governance.“As the municipality we remain committed to the principles and values of good and clean governance. The city manager is currently tightening up the review and due diligence processes on all matters that affect supply chain management processes within the city. We do this because we want to ensure that we have good and sound supply chain management processes. We need to be clear about the lines of accountability and the chain of command in how our internal submissions for approvals move among our officials, so that no lines are blurred when it comes to the supply chain management processes,” she said.
Deputy city manager of finance, Krish Kumar said the city has zero tolerance with regards to irregular expenditure and continued to look at ways of reducing it. “It is important to note that the municipality has implemented stronger oversight measures. This includes; all irregular expenditure being reported to ensure transparency, all instances of irregular expenditure are investigated by the CIIU. Based on the outcome of the CIIU report, consequence management will be instituted.