Treasury says NO! NO! NO! to luxury festive spending

Nhlanhla Nene.
Nhlanhla Nene.

Johannesburg - No to lavish hotels, expensive flights, credit cards, luxury cars and booze at government parties.

That’s the hard line National ­Treasury is taking as it turns down requests from government departments and agencies to “deviate” from belt-tightening measures.

Even the presidency has not been spared the tough treatment, with requests from the offices of ­President Jacob Zuma and his deputy, Cyril Ramaphosa, being rejected outright.

Details of the Treasury’s no-nonsense austerity measures are contained in a ­detailed reply Finance Minister Nhlanhla Nene gave to a parliamentary question from DA MP David Maynier.

It is the first clear line that Treasury is not willing to tolerate the tendency by ­government departments to ignore austerity directives and then later ask it to condone their splurges.

Treasury has had a hard time enforcing belt-tightening measures since former finance minister Pravin Gordhan banned unnecessary spending in December 2013. ­Ministers and officials often continued with business as usual, despite evidence that the fiscus was under severe strain. Auditor-General and Treasury figures reveal that wasteful spending on consultants, travel and catering reached up to R30 billion in the 2013/14 financial year.

Then the office of the Accountant-General in ­National Treasury established an exemption committee to assess requests by government departments to spend more than what was allowed.

It received 56 applications between November 2013 and August this year, but only approved nine requests for exemptions and turned down 39 of them.

The remaining eight may still be under ­consideration.

Among the “deviations” National Treasury turned down were:

» Business class trips for presidency staff flying long-distance. They were told to fly economy class;

» Hotel rooms costing more than R1 300 a night for presidency officials;

» Upgrading the presidency’s national orders advisory council from Group B cars (Toyota Corollas and VW Polos) to luxury vehicles (E-Class Mercedes);

» The Independent Electoral Commission’s request to buy alcohol for two functions, including a gala dinner for the announcement of the 2014 election results;

» Business class tickets and luxury-car hire by the State Security Agency;

» Three extra credit cards, which Brand SA asked for “to carry out operations in foreign countries”; and

» Entertainment allowances from various department and entities.

On eight occasions, Treasury told the applicants that what they were requesting was “not necessary”.

No fun any more

Two senior civil servants, a chief director and a director, who spoke on condition of anonymity, said the measures had taken the “fun” out of year-end parties and social events.

“We used to look forward to Christmas parties, but now we have to club together to buy alcohol.

“We used to go out to different venues, but most year-end events are now held in department offices,” said the director.

“Sometimes when we travel to far-flung areas, there is no accommodation for that price, or the accommodation is fully booked, except for the hotels, which cost more than those rates.

“When we travel, they should house us in accommodation of a similar standard, not guesthouses that are considered unsafe at times,” said the official.

A chief director who has been in the civil service for seven years said: “This has taken all the fun out of Christmas parties.

“The idea for these events is to unwind and relax after a long year. If you drink booze, you’re unlikely to attend that party. Some of the measures are ridiculous, but others are understandable.”

How much money we’re saving

In his February budget speech, Nene told Parliament the austerity measures were working, with a 3% (R364 million) decrease in spending on consultants, a 6% (R571 million) decrease in travel and subsistence costs, and a 47% (R1.075 billion) decrease in catering, entertainment and events expenditure across all departments in the 2013/14 financial year.

This saw fruitless and wasteful expenditure drop from R2.4 billion to R1.1 billion in 2013/14.

In 2014/15, the measures led government to cut wasteful expenditure further, with R2 billion saved on consultants, travel and catering expenses.

However, the results of the 2014/15 audits will only be released by the Auditor-General this week.

Rejected requests

Nene’s reply revealed that Presidency officials wanted to fly business class “as they are required to fly for about 20 hours in the economy class and still be fresh to work on arrival”.

Despite this, they were turned down.

The presidency also wanted to exceed the R1 300 accommodation limit for “support staff”, who are “required to reside in close proximity to the hotels where the principals reside”.

A department of defence application for various exemptions was rejected despite the department citing “uniqueness” as a reason for its defence intelligence and special forces operations officials to be exempted.

The defence department also wanted officials to fly business class for “efficiency and security reasons”. It also wanted an exemption for “team-building and social events” and to use consultants as “classified” casual workers and laboratory services.

Arguing for leniency, the department of military veterans told Treasury it was “experiencing problems with finding domestic hotels” for R1 300 a night in cities such as Cape Town, Durban and Polokwane.

This was having “a negative impact on service delivery”.

The North West provincial treasury asked Nene for a “blanket approval” to increase the accommodation limit to R1 800 and allow heads of department to stay at the same hotels as MECs.

Transnet was also turned down when it requested “blanket” deviations for travel and subsistence, including expensive car hire and accommodation.

In March last year, Treasury blocked the department of transport from hiring an accounting firm as consultants to conduct research and suggested it use the CSIR instead.

Some departments said the measures were unreasonable, and complained that the R1 300 limit for accommodation was inadequate and meant that senior officials felt “unsafe” using cheaper hotels and hiring smaller vehicles.


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