Govt owes AG R500 million

2012-09-04 14:21

The three spheres of government owe the Auditor-General Terrence Nombembe nearly R500 million in unpaid audit fees.

Local government debt stands at R206 million, up from R170 million last year, while provincial departments owe R124 million, according to the Auditor-General’s 2011/12 annual report.

Nombembe has warned that increasing local government debt may cause cash flow problems for his office.

National departments have not paid R63 million and other state-owned entities owe R58 million.

Of the R206 million owed by local government, Eastern Cape municipalities owe R57 million,
North West (R42 million), Northern Cape (R37 million) and Free State (R23 million).

Last year, the total debt stood at R399 million.

In the annual report, Nombembe has noted that debt collection from municipalities continues to
deteriorate.

“Our biggest concern is the deteriorating situation regarding the total debts of auditees,” says the A-G.

Municipalities make up 30% of the Auditor-General’s income but are also responsible for 43% of the total outstanding debt.

Nombembe has instituted efforts to improve this situation including charging interest on overdue accounts.

The Auditor-General asked for R53 million from the National Treasury to help settle the debt.

However, the National Treasury could only provide R29 million due to its own budgetary constraints.

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