Treasury paints bleak picture of North West govt's finances

Treasury Director General Dondo Mogajane. (Photo: Gallo Images / The Times / Esa Alexander)
Treasury Director General Dondo Mogajane. (Photo: Gallo Images / The Times / Esa Alexander)

Cape Town – The office of the Premier of the North West Province has suffered pervasive irrational executive decisions and poor financial decisions as far back as the 2014/15 financial year, says National Treasury director general Dondo Mogajane.

National Treasury's briefing to Parliament on Wednesday follows former premier Supra Mahumapelo, who assumed office after the 2014 national election, stepping down as provincial leader.

Mogajane gave a damning account of the state of the North West, with Treasury listing failure to provide oversight and leadership in service delivery and the intimidation of provincial departments, among other things.

Intimidation, lie detectors

Intimidation included imposing lie detector tests for finance personnel. Treasury also found that R10m worth of spending on social services was diverted.

Mahumapelo was replaced by Tebogo Mokgoro in June, after the former famously created "the essence of the absence of presence" from office.

Government has since implemented an intervention for five departments in the North West provincial government in terms of Section 100 of the Constitution, which empowers the national executive to take remedial action where a provincial government cannot fulfil its Constitutional obligations.

Addressing Parliament's ad hoc committee on interventions into the North West government and the select committee on finance, Mogajane said the provincial government's great weakness was not lack of funding, but poor supply chain management.

"There is no possibility that the North West government will shut down because it doesn't have money.

"It is because of a poor supply chain management system," said Mogajane.

He also told MPs the provincial government had R15.3bn in irregular expenditure at the end of March 2017.

This meant the irregular expenditure had increased consistently at an average of R2.1bn per year from the R8.6bn in the 2014/15 financial year, he added.

The North West provincial government’s budget in 2017/18 financial year stands at R39.6bn, with underspending of R834m.

The provincial departments of Education, Public Works, Community Safety, Health and the office of the premier incurred irregular expenditure due to non-compliance with National Treasury regulations and supply chain management guidelines.

Among other governance decisions that were questioned was the fact that North West Parks and the Tourism Board were shifted to the office of the premier in the 2014/15 financial year.

* Sign up to Fin24's top news in your inbox: SUBSCRIBE TO FIN24 NEWSLETTER

Brent Crude
All Share
Top 40
Financial 15
Industrial 25
Resource 10
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Please select an option Oops! Something went wrong, please try again later.
I'm not really directly affected
18% - 2176 votes
I am taking a hit, but should be able to recover in the next year
23% - 2780 votes
My finances have been devastated
35% - 4210 votes
It's still too early to know what the full effect will be
25% - 3019 votes