SEKHUKHUNE – The Democratic Alliance (DA) in Limpopo expressed concerns about alleged lack of sound financial management in the Road Agency Limpopo (RAL) which allegedly left the public entity virtually bankrupt.
According to the opposition party the Auditor General’s (AG) briefing notes for the Standing Committee on Public Accounts (SCOPA) painted a bleak picture of the public entity’s finances and management and its current inability to fund monthly operational expenditure and continue rendering services.
Katlego Phala, DA Limpopo Spokesperson on Public Works, Roads and Infrastructure, said although the deficit for the current year decreased from R924 million to R832 million compared to the prior year, RAL’s total commitments was R2.256 billion.
Phala said in effect, RAL had committed its 2019/20 budgets plus an additional unbudgeted R180 million.
“The AG flagged irregular expenditure in that effective and appropriate steps were not taken to prevent irregular expenditure amounting to R944 706 000. Expenditure was incurred without an approved budget and also in excess of the approved budget, in contravention of section 53(4) of the PFMA. Irregular expenditure identified in the previous year was not investigated to determine if the person liable for the expenditure, R1 913 090 000. Despite the ongoing irregular expenditure within the public entity, it seems that management was severely lacking,” said Phala.
Phala said that in the current financial year, only one case was ongoing into allegations relating to financial misconduct, fraud and or improper supply chain management.
“The lack of contract management resulted in the amendment of two contracts without approval by a delegated official. The total value of the extensions was R1 697 990 51. Furthermore, nine contracts or providers were not monitored monthly. The total value of the related contracts was R56 235 221 44,” said Phala.
She said the DA called on Limpopo MEC for Public Works, Roads and Infrastructure, Monnica Mochadi to create an environment of zero tolerance to non-compliance within RAL by ensuring the implementation of the recommendations of the AG’s 2018/19 PFMA audit outcomes.
“This will result in adequate adherence to supply chain management processes and regulation spending in accordance with approved budget achievement on audit of pre-determined objectives should be supported with verified evidence, regular financial viability assessment should be done in key management positions and implementation of consequence management,” said Phala.
She concluded it was time that RAL’s accounting officer exercises the duty of utmost care to ensure protection of the assets and records of the public entity instead of unabatedly and carelessly committing public funds that were not utilized in the public interest.