Government departments and entities responsible for key IT projects have been found to have misspent about half-a-billion rand through overspending, supply chain management issues or fruitless and wasteful expenditure.
The Auditor-General's latest general report, on National Audit Outcomes for the year to March 2011, found that government departments incurred irregular expenditure related to supply chain management of R1.8 billion.
Public entities - the Companies and Intellectual Property Commission, the Information Systems, Electronics and Telecommunications Training Authority, the Road Traffic Management Corporation, the State IT Agency (SITA), the Independent Communications Authority of SA, and the Universal Services and Access Agency of SA - were flagged in the report.
In total, those entities accounted for R463 million - the bulk of which was attributed to SITA - of the R1.99 billion of irregular spending across all public entities linked to supply chain management.
SITA was found to have uncompetitive or unfair procurement practices, inadequate contract management, and to have awarded tenders to state officials and their close family members.
In total, public entities incurred R164.2 million in fruitless and wasteful expenditure, of which ICT-related entities accounted for R49.6 million.
Lacking control
The departments of Communications, Public Service and Administration, Science and Technology, as well as Trade and Industry - only four of the 39 departments audited - accounted for R44 million of irregular expenditure linked to supply chain management.
In addition, these departments incurred fruitless and wasteful expenditure of R2 million out of the total found of R428.8 million.
Departments with findings on supply chain management included Communications, which was found to have inadequate controls, as well as uncompetitive or unfair procurement practices.
The Department of Public Service and Administration was found to have uncompetitive or unfair procurement practices and inadequate contract management. Trade and Industry also had uncompetitive or unfair procurement practices and inadequate contract management.
Not on
digital TV migration.
Gilmour says the situation is unacceptable, and more accountability is needed to make sure money is spent correctly and that key projects get off the ground. “We are worshipping at the altar of inefficiency.”
Bart Henderson, CEO of risk management consultancy Henderson Solutions, says the report is a “graphic reflection of the level of ineptitude and pillage of our country”.
Henderson points out that 4 193 contracts, worth R25.6 billion, were tested, and adverse spending amounted to R8 538 930 374, or 33.3% of the total tested, which is equal to less than 10% of the national budget.
“Extrapolated against the national budget, the AGSA findings become the stuff of nightmares, indicating that the true extent of the abuse of or non-compliance with supply change management protocols involving unfair or uncompetitive procurement practices, unauthorised, irregular, and fruitless and wasteful expenditure, as well as material losses and impairment of assets, accounts for in excess of R90 billion in total spending.”
Related story:
Govt IT fails SA
Share
