THE 5 SA MUNICIPALITIES GUILTY OF WORST FRUITLESS EXPENDITURE

The most recent audit from the Auditor-General(AG) reveals that just five municipalities were responsible for 59% of total fruitless expenditure in the 2014-2015 financial year.

The audit outcomes report shows fruitless and wasteful expenditure amounted to R3.741 billion, representing an increase of more than 50% over a five-year period.

Of the country’s 278 municipalities, 227 incurred fruitless and wasteful expenditure, with five municipalities contributing 59% of total fruitless expenditure in the 2014-2015 financial year.

The worst offender was the Nelson Mandela Bay metro in the Eastern Cape, with 10 instances of fruitless expenditure amounting to a total of R423 million.

In second place was Matjhabeng in the Free State, with 32 instances totalling R152 million.

Emalahleni in Mpumalanga was responsible for R95 million worth of fruitless expenditure from 40 instances.

Maluti-A-Phofung in the Free State came in fourth place, with R78 million from 113 instances.

he fifth worst offender was Thaba Chweu in Mpumalanga with 322 instances of fruitless expenditure amounting to a total of R36 million

However, the AG notes that not all of this money/expenditure should be seen as illicit, corrupt expenditure, but rather reflect systemic problems with compliance.

Its report states that one of the most common areas of non-compliance in the last five years is “material misstatements in submitted financial statements, management of procurement and contracts, and the prevention of unauthorised, irregular as well as fruitless and wasteful expenditure”.