In a recent report, the Auditor-General revealed that the South African government has wasted a staggering R22 billion during President Cyril Ramaphosa’s current term.
This wasteful expenditure includes R7.62 billion over the past five years and R14.34 billion in financial losses due to non-compliance, suspected fraud, and irregularities.
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The report highlights various factors contributing to this wasteful expenditure, including poor payment practices, a lack of benefits from money spent, unfair procurement processes, neglected maintenance, and poor planning.
These issues have placed an unnecessary burden on government finances and hindered effective service delivery.
While the report does acknowledge an overall improvement in the audit outcomes for national and provincial government and public entities, it raises concerns about the financial risks associated with state-owned enterprises (SOEs).
The Auditor-General reveals that more than R386 billion of government guarantees are exposed to SOEs’ borrowing programs, despite their poor growth, unsustainable operational challenges, and high debt-servicing costs. Some of these SOEs are also at risk of defaulting on their debts.
Additionally, state departments face R113 billion in claims, with R68 billion alone in the healthcare sector. When these claims are paid, the funds come from budgets allocated for service delivery, further impacting the government’s ability to meet the needs of its citizens.
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The Auditor-General’s report serves as a reminder of the importance of effective financial management and accountability within the government while speaking to the urgent need for improved payment practices, transparent procurement processes, and better maintenance planning to prevent wasteful expenditure.
Addressing these issues will not only help save billions of rands but also ensure that taxpayer money is used efficiently and effectively. It is crucial for the government to prioritize responsible financial management to build trust with the public and deliver on its mandate of service delivery.
