Sixth administration improved in its five-year tenure across the board

Auditor-general Tsakani Maluleke tabled the 2023/24 report into national and provincial government which found scores of clean audits across the country

The government’s sixth administration produced a good audit outcome which improved across all national and provincial governments but high-impact entities that provided crucial services saw a weaker performance and slow improvement, auditor-general Tsakani Maluleke said on Tuesday.

Maluleke tabled the 2023/24 general report for national and provincial departments before parliament’s standing committee on public accounts (Scopa) on Tuesday where she said the government had showed an improvement in the ability to transparently report on its finances and performance in the past five years.

“We have seen improvements in the past five years right across systems including technical and vocational education and training (TVET) colleges. It tells us that attention to these critical things has much improved over the past five years. We can celebrate and acknowledge the improvement of accounting officers on how they performed in an audit outcome point of view,” she said.

Out of the 415 audited entities, 142 received a clean audit, making up 35% of the audit base. This included 63 departments and 79 public entities. This means they have credible financial statements, a useful reliable performance report and no material noncompliance with key laws and regulations.

“There are 65 auditees that maintained this clean audit in the past five years. There are a number of institutions across the country that have mastered the art of remaining in the clean audit zone and mastered the key disciplines that are on good management, performance report and complying with the rule of law,” she said.

These consecutive clean audits were achieved in national entities such as the department of science and innovation, parliament, the Companies and Intellectual Property Commission (CIPC) and Legal Aid SA.

On a provincial level, the clean auditees included the premiers' offices of Gauteng, Northern Cape and Western Cape, the provincial treasury of Eastern Cape, Northern Cape, Gauteng, North West, Western Cape, KZN; the Gautrain Management Agency, Mpumalanga co-operative governance and traditional affairs, and the Western Cape legislature.

“They tell us that the things the audit office and the Public Finance Management Act insist on and things we deem important are attainable, and not just desirable. These [entities] look after 13% of the expenditure budget,” Maluleke said.

However, what was of concern was the poor performance and slow improvement of high-impact departments, which have the biggest affect not only on government finances but also on the lives of the public.

These entities are critical in providing services in education, skills development and employment, human settlements, infrastructure development, roads and transport, safety and security, and water and sanitation.

She said they are also responsible for about 77% of the 2023/24 expenditure budget of the national and provincial government yet continue to have the worst audit outcomes and improve at a slower pace than other auditees.

High-impact entities make up 137 (60%) of the 227 entities that had material findings when it came to compliance with key regulations.

“All of the departments in the human settlement sector; 80% or more of the auditees in the basic education, transport, public works and health sectors; and the department of water & sanitation had material findings on compliance. A total of 169 (74%) auditees had material compliance findings in every year of the administration’s term, comprising 71 departments and 98 public entities. Of these, 109 were high-impact.”

As for fruitless and wasteful expenditure, it totalled R10.34bn in the sixth administration, with high-impact entities being responsible for 84% of this amount. For 2023/24, the total fruitless and wasteful expenditure for all entities was R2.57bn, a jump of 49% from the previous year, with high-impact entities being responsible for 80% of this amount.

These include Transnet which spent R580m on overpayments, interest and penalties and costs of cancelled infrastructure projects. The Gauteng department of human settlements used R520m on costs of feasibility studies on cancelled housing projects.

“We remain committed to partnering with and supporting the public sector through our audits, the use of our expanded powers as granted by the Public Audit Act amendments, and the many initiatives that we have implemented to assist and guide all role players.”

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