Local newsMunicipalNews

Tshwane incurs more than R300m irregular expenditure on two projects

The metro says it did not lose any money and pins the irregular expenditure to be caused by not following all procurement processes properly in projects worth millions.

The Tshwane metro incurred irregular expenditure of more than R300-million on two projects in the 2021/22 financial year yet said no money was lost.

According to a report of the financial services department tabled in the last council meeting late last month, the metro incurred R329 343 647 in irregular, fruitless and wasteful expenditure from April to June. The Auditor General describes irregular expenditure to be incurred when requirements of the supply chain management policy or municipality by-laws followed in awarding projects are flawed.

R126-million awarded for the A re Yeng bus operations and R203-million for payments for leasing offices to a private company were irregular expenditure.

The report recommended that:

– the expenditure be referred for investigation and recovered from the person/s liable or written-off if it is irrecoverable.
– the municipal public accounts committee (MPAC) investigates and makes a recommendation to council on the way forward.

However, the Tshwane metro in a statement said the municipality did not lose any money, “the expenditure incurred was for the benefit of the metro”. It said the irregular expenditure was in the procurement process, meaning not all procurement guidelines were adhered to.

“The investigation findings will guide what consequences will be implemented,” the statement said.
“The incurrence of irregular expenditure, whilst not desirable and must be rooted out, does not mean that the metro has incurred losses.
“It is simply a function of incurring the expenditure which the metro would have benefitted from, without having fully followed the prescribed processes.”

ALSO READ: Tshwane incurs R13-billion in irregular expenditure

Earlier this year, the metro was criticised for R1-billion in irregular expenditure in a single housing project, and R493.2-million in Covid-19 funds mismanaged.

Then the Tshwane audit and performance committee raised concerns that weak controls identified in a past forensic investigation were never formally addressed.The committee recommended that the municipality adheres to rules to avoid wasteful and irregular expenditure.
The metro said policies were being followed despite the latest irregular expenditure finding.

Economist Dr Azar Jammine said when procurement processes are not followed properly, corruption and fraud were more likely to take place, which would be a concern for residents.

“Irregular expenditure is less serious when no money is lost, however, the major concern is that when processes are not followed there is danger because you can get a situation where corruption seeps in and that is why one would rather not see irregular expenditure happening.”

ALSO READ: Tshwane metro slammed on R1-billion irregular expenditure

Jammine also said sometimes following all the procurement processes negatively affected the economy due to the process taking too long. He said processes at times delayed projects, in essence, service delivery to residents.

“One of the biggest problems we have right now is that there are a lot of infrastructure projects that are not being implemented on time and in some cases are due to overly scrutinising projects.”

Do you have more information about the story?

Please send us an email to editorial@rekord.co.za or phone us on 083 625 4114.

For free breaking and community news, visit Rekord’s websites: Rekord East

For more news and interesting articles, like Rekord on Facebook, follow us on Twitter or Instagram

Back to top button