Millions on ‘stand-by’ projects

2013-08-16 00:00

A TOTAL of R31,2 million spent by the Economic Development Department on projects that were not directly allocated funds by Treasury in the last financial year, has raised eyebrows in one of the portfolio committees in the Legislature.

This after an unaudited report of the department’s financial statements was tabled at the finance portfolio committee earlier this week.

A report tabled at the committee showed an unaudited underspending totalling R31,2 million on various projects due to delays in the finalisation of service level agreements.

The amount was meant to be spent on fresh produce mentorship (R10 million); management training (R7,3 million); technical skills (R4,3 million); Operation Vuselela (R4 million); mentorship of cleaning and sewing co-operatives (R2 million); and Umyezane Awards (R2,4 million).

However, chief finance officer Bongani Shezi said the allocations for these projects were spent on other unnamed projects.

Shezi attributed the expenditure to the department approving more projects for funding so that when some failed they were replaced by others that had already been approved.

“What we do at the start of year is to approve more projects than what is available in our budget.

“When we notice in the course of the year that one or two fail, after the adjustment budget we replace them with newer projects,” Shezi said.

He said the auditor-general had been told what had happened regarding the usage of the funds initially allocated for specific projects, which were then spent on others.

The committee was later told by officials from provincial Treasury that departments were allowed to move funds from one project to another as long they fell within the same economic category.

The spending was just one of the items of questionable expenditure by the department in the last financial year.

The committee was told about advance payments made to service providers before planned events took place.

In one instance the department paid R15 million for the Top Gear Festival.

They also paid R26 million for the North Sea Jazz Festival, which was later canned when problems were experienced in its organising between the festival promoters, rights holders and the department.

An explanation was given that it was common practice for advance payment to be made for such events.

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