Threats and bribes – Auditor General tells of lengths councils go to avoid accountability

Auditor General Kimi Makwetu told Parliament's Standing Committee on the Auditor General that auditors and other staff in his office's various branches have had to endure stressful conditions - including bribes and intimidation from individuals representing auditee councils between August and November.

Under Makwetu's leadership, the office of the Auditor General of South Africa (AG) has been as strict as ever when it comes to financial statements of government departments and entities. In November, he was even so blunt as to say the latest financial statements by state-owned entities were the worst ever, Fin24 previously reported.

The threats and bribes are seen as a bid to prevent unfavourable audit outcomes which would expose mismanagement at a local government level. Recent reports emerged that officials from the AG were forced to flee the municipal offices of Nelson Mandela Bay Municipality Metropolitan due to intimidation.

Addressing the committee on Wednesday afternoon, Makwetu said that strike action has often prevented his teams from auditing municipalities, including Zululand Municipality in KwaZulu Natal and King Sabata Dalindyebo Municipality in the Eastern Cape.

"The reality is that it makes people who are supposed to do the independent tests on transactions at the various institutions feel awkward when certain statements and acts that are unusual in the audit environment start to become a feature in the area where they conduct the audit," said Makwetu.

The incidences of intimidation and disruption to the AG office's work took place between August and November this year.

Makwetu told the standing committee that strike action affected the work of seven business units; one in Mpumalanga, two in KwaZulu Natal and four in the Eastern Cape.

"There are always labour and other disputes in the areas. We asked our staff not to be selective when reporting these because they tend to contaminate an environment where an audit is supposed to take place," said Makwetu.

Makwetu said AG staff reported threats and intimidation from employees of Rand Water and the municipal manager of Victor Khanye Municipality in Mpumalanga. 

Contacted by Fin24 on Friday, Victor Khanye municipal manager Thabitha Matladi denied the interaction and the threat.

"No, it's not true and I am responding to the executive mayor, who is following proper channels with the office of the Auditor General on how to deal with this matter," said Matladi.

As for the intimidation at the Nelson Mandela Bay Metropolitan Municipality, spokesperson Kupido Baron told Fin24 that the municipality was appalled when the staff from the office of the AG received threats and tried their best to accommodate the staff members elsewhere after the threats occured.

"In this regard they temporarily made use of our Joint Operations Centre (JOC), based at our Safety and Security headquarters at the South End Fire Station. However due to the fact that the JOC is an operational facility - sometimes needed at a moments notice, we could not accommodate them there on a permanent basis.

Baron said the AG staff are currently based at a secure location in Nelson Mandela Bay. He said AG staff had the municipality's full support and unrestricted access to any financial information that they required.

According to Makwetu, the chief financial officer of Mpofana Municipality in KwaZulu Natal allegedly offered the AG's team there a bribe.

Mpofana Local Municipality administrator Zwakele Mngonyama told Fin24 that the municipality placed the chief financial officer on special leave after the bribery allegations emerged.

"I got there when the audit started. We met with the DDG (Deputy Director-General) who wanted to see me and the senior managers. After the meeting with administrators, they raised the allegations that a bribe was solicited. The CFO was placed on special leave pending investigation," said Mngonyama.

Makwetu said all cases were reported to law enforcement authorities for investigation and assistance was sought from the police regarding the safety of AG employees.

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