Gauteng social development corruption eats into feeding schemes

Probes into corruption at the Gauteng department of social development more than doubled in the past year compared to 2019 as non-profit organisations (NPOs) continue to suffer.

The department has initiated 57 forensic investigations into misconduct allegations by officials in the past year, including those involving dodgy transactions with NPOs. In the 2018-19 financial year there were just 16.

Investigations into the lack of internal controls over finances have shown at least R1 million stolen from the state over the past four years through officials’ dealings with NPOs and other transgressions. Only R561,714 has been recovered and several cases have yet to see action taken.

Also Read: NPOs left high and dry after being ‘sidelined’ by government

A fourth year has gone by with no answers about the disappearance of R5 million of state funds from a Gauteng NPO account before it could be transferred to its final destination, a Life Esidimeni rehabilitation centre.

The department has service level agreements with around 2,600 non-profit organisations and has come under the spotlight over a scandal involving conduit payments made through NPOs. These transactions landed the department in a lengthy court battle with NPO A re Ageng after R20 million landed in its bank account, ostensibly without its knowledge before some of it disappeared.

The officials involved have since been exonerated.

The information was revealed in replies to a legislature question by the DA, wanting to know how many forensic investigations had been conducted and finalised since 2018. In her reply, social development MEC Thuliswa Nkabinde-Khawe said there were a total of 57 investigations of which 32 had been completed.

Also Read: Officials off the hook in NGO fraud racket

Fourteen of these were for transgressions involving internal controls such as supply-chain management abuse of Gauteng government vehicles and the appointment of NPOs. Of these, 10 cases resulted in disciplinary action while three were of a criminal nature and referred to the police.

According to Nkabinde-Khawe,  R561,714.84 had been recovered out of a total R896,388.37 that was stolen. She said the balance was being recovered on a monthly basis. The department has implemented 24 recommendations from forensic reports while 30 have not yet been implemented. The latter is due to labour disputes while others are awaiting the CFO to implement them.

In 2018-19, 16 investigations were initiated, 3 of which are still open. In 2019-20 the department initiated 26 investigations of which 17 were finalised and nine have not. In 2020-21, 57 investigations were initiated 32 of which have been finalised and 24 are still in progress.

Transgressions still under investigation are:

• Management override controls
• Lack of segregation of duties
• Lack of internal control systems in place to monitor and evaluate the process of the appointment of NPOs
• Lack of internal control systems to monitor and evaluate the NPOs performance against a signed service-level agreement
• Lack of internal control systems in place to safeguard the transfer of money to NPOs
• Supply chain management and  internal control deficiencies
• Lack of monitoring of the use of Gauteng government vehicles

NPOs have been complaining about the late or non-payment of funds for the past year, as they struggle to continue with their programmes.

Complaints to the DA and The Citizen indicate that the Gauteng department of social pevelopment failed to pay subsidies to NPOs for the first quarter of the new financial year, despite signing new service level agreements on 15 April 2021.

This has seen a number of NGOs closing their doors. Programmes include feeding schemes around the province.

simnikiweh@citizen.co.za