National Treasury is using digital solutions to weed out what it calls ‘ghost workers’ – non-existent civil servants who are pulling a salary. It aims to finalise the identification process by November.
A recent presentation to Parliament’s Portfolio Committee on Public Service and Administration showed that millions of rands are lost each year when salaries are paid to people who have resigned, been fired, retired, or are dead.
The Portfolio Committee on Public Service and Administration says in a statement that members of the committee were “stern in their rebuke of accounting officers who preside over such losses without consequence and questioned how such conduct is not deemed criminal”.
In one example provided by the Auditor-General of South Africa, Mpumalanga’s provincial education department disclosed R28.3 million in salary overpayments made to employees after their services were terminated due to death, resignation, retirement or dismissal.
Hunting ghosts
To combat the fraud, National Treasury is cross-checking data with the South African Revenue Service (SARS), the Department of Home Affairs (DHA) and other institutions to identify ghost employees, duplicate IDs, multiple salaries and unauthorised allowances using the government’s payroll solution, PERSAL, as a base.
In its presentation to Parliament, National Treasury says there is an “urgent need to strengthen verification and onboarding of public servants”.
The fiscal department adds that the digital transformation initiatives − led by the Presidency, National Treasury and the Department of Communications and Digital Technologies − presents an opportunity to introduce digital ID, single sign-on and digital credential wallets.
“These will enable more efficient detection of anomalies and prevention of ghost workers,” National Treasury says. Salaries account for 60% of government spending and there are 1.3 million civil servants on the state’s payroll.
By the time of the medium-term budget policy statement, scheduled for November instead of October as is customary, National Treasury says it wants to have identified the non-existent employees.
The pushing out of the mini budget is likely because the National Budget was finally passed by the National Assembly in May instead of February due to MPs disagreeing over an increase in value-added tax.
The fiscal department explains that “a ghost worker can be defined as a person who knowingly or not is placed on the payroll and doesn’t complete the work associated with the role they are employed for. Additionally, it can be a fictitious person intentionally placed on the payroll by another employee.”
Putting data to work
National Treasury is adopting a data-driven approach, moving beyond traditional census-based methods that are costly, slow and department-limited. By leveraging existing administrative datasets across all national and provincial departments, this project will provide a faster, more comprehensive and cost-effective way to detect ghost workers, as well as payroll irregularities.
Payroll irregularities include overpayments, unauthorised allowances and breaches of expenditure regulations. While less severe than ghost workers, this can still cause significant losses. In other countries, similar analyses found more discrepancies from payroll irregularities because of a clampdown on ghost workers.
Key departments have been approached to provide data for identifying ghost workers and payroll irregularities. National Treasury’s PERSAL data is central to the analysis, while the Department of Public Service and Administration will help with alignment with the Public Service Act.
Multiple departments
Engagements with SARS and the DHA aim to integrate tax, population and biometric data. National Treasury adds that a legal framework and memorandum of understanding are being established to enable ongoing data sharing and collaboration.
In addition, National Treasury says key departments have been approached to provide data or support for the project. The Department of Basic Education will share the Education Management Information System data and information on past ghost worker initiatives, National Treasury’s presentation says.
It adds that the Auditor-General of South Africa will advise on existing ghost worker detection methods, and the Financial Intelligence Centre is engaging with banks around the possible use of banking and ‘know your customer’ data, with legal frameworks being discussed to enable collaboration.
While there are currently no final results available, National Treasury says it is testing PERSAL to, for example, identify ID numbers that have one or more PERSAL number allocated to them. It has integrated the payroll data with tax information, and SARS has undertaken tests, with the results being shared.
National Treasury is also using DHA data to flag officials without valid IDs and to check, via biometrics and photos, whether a public servant’s image is linked to multiple identities on the payroll or the National Population Register. Yet, it notes that “these tests are limited to public servants with a smart ID or passport as picture quality may not be sufficient for those with the old ID book”.
In the middle of this year, home affairs minister Dr Leon Schreiber said the upgraded National Population Register was an investment in “national security, in financial inclusion, and in the value of our cherished South African identity that will pay off handsomely for our country”.
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