Fears welfare funds looted

2018-11-01 15:45
So far government departments and state entites have incurred R72.6bn in accumulated irregular expenditure, the DA says.

So far government departments and state entites have incurred R72.6bn in accumulated irregular expenditure, the DA says.

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With cash-strapped non-profit organistations (NPOs) struggling to stay afloat, there are concerns that the R1 billion being spent by the KZN Social Development Department on NPOs annually, is being channelled to bogus welfare entities.

In what makes a mockery of the provincial government’s austerity measures designed to conserve resources, it has emerged that the department lacked the capacity to monitor their spending on the NPOs.

Briefing the provincial legislature’s public accounts committee (Scopa), the chairperson of the social cluster audit committee, Peren Christianson, said the lack of monitoring meant that there was no evidence that the nearly R1 billion allocated to the NPOs was going to good use. “Our concern is that the lack of monitoring of the institutions who receive funding from the department creates a window for fraud and misuse of the funds; it makes it possible for funds to be transferred to institutions that do not exist.

“We are equally worried about the fact that institutions were paid more than what the department had budgeted for,” Christianson said.

The department currently funds 3 700 NPOs across the province, ranging from old age homes to orphanages.

Social Development head of department Nokuthula Khanyile conceded to Scopa members that the department lacked the capacity to monitor NPOs.

“The department is currently working with the University of KwaZulu-Natal to review our monitoring tools.

“What is clear is that we need to strengthen our monitoring and evaluation tools,” she said.

Khanyile said the monitoring of NPOs was further undermined by the fact that department officials who were supposed to do the monitoring had been working closely with the NPOs over a period of time.

“It really becomes difficult for those officials to monitor the same NPOs with which they had developed relationships over years. There is a real possibility that we could outsource the monitoring functions,” she said.

Fears that the department’s NPO fund was being looted are being raised on the back of a 2016 forensic report that implicated several NPOs in the mismanagement of funds allocated to them.

NPOs that were fingered in the report largely operated in the Pietermaritzburg, eThekwini and Ulundi areas.

Seventeen investigations, manly focusing on irregularities within the department’s supply chain management unit, have been conducted by the provincial treasury’s internal audit unit in recent months.

In his 2017/18 report, the auditor-general found that the department’s leadership had failed to exercise effective oversight and monitoring in line with supply chain management regulations.

Khanyile told Scopa members that the department’s leadership had struggled to conduct proper oversight on the supply chain management unit due to the fact that there had not been a permeant chief financial officer (CFO).

Going forward, Khanyile said, things were likely to improve as the CFO post has since been filled.

Weak monitoring and evaluation tools in the department have also resulted in corrupt department officials employing people without following stipulated human resources management guidelines.

As a result, several people who did not meet the minimum requirements for the advertised posts were appointed.

“Some of the people who were appointed didn’t even apply for the posts to which they were appointed — they were just appointed,” Khanyile said.

The department has since lodged an application at the labour court to get employees who were irregularly appointed removed.

DA member of the provincial legislature (MPL) Francois Rodgers, who is also a member of Scopa, said he was concerned about the fact that despite several investigations having been instituted in the department, no action has been taken against officials implicated in wrong-doing.

“We also want to know the cost of all these investigations,” he said.

Acting Scopa chairperson Sipho Nkosi asked the department to prepare a detailed report of the investigations.

“Members want to be able to establish whether there is any progress,” he said.

• clive.ndou@witness.co.za


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