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R27 million of taxpayers money missing in thin air and now KZN’s traditional councils can’t explain how and where it went

Posted on 05/12/2018 Leave a comment

KwaZulu-Natal’s traditional authorities have failed to account for more than R11-million in levies collected by the province’s amakhosi from their subjects during the past financial year.

They were also unable to account for more than R15-million in property under their control, according to the 2017-2018 annual report of the Traditional Levies and Trust Account.

The report was submitted to the KwaZulu-Natal legislature this week by the MEC for co-operative governance and traditional affairs, Nomusa Dube-Ncube.

Co-operative governance MEC Nomusa Dube-Ncube said the audit was disappointing. (Mandla Mkhize)
Poor accounting systems and a strike by the secretaries of the province’s tribal councils resulted in the auditor general’s office issuing a qualified audit outcome against the entity.

The more than 350 secretaries, who receive a government stipend of R1 600 a month, want the department to pay them R12 000 instead, which the co-operative government department says it cannot afford.

The levies and trust account is managed by the department in the province and is used to consolidate levies, fines and other revenue raised by the traditional authorities from people living on the land under their control. Nearly three million hectares of land in KwaZulu-Natal fall under the traditional authorities.

Each traditional authority is headed by an inkosi assisted by a number of izinduna.
In his audit report, which makes up part of the annual report, auditor general Kimi Makwetu said his staff had been unable to verify revenue collected by the traditional authorities because they could not get access to “certain premises”.

As a result, levies amounting to just over R11-million could not be verified. This included R5.53-million in customary fees, R3.31-million from land use and R399 00 in fines.

And the auditor general’s staff were unable to verify a further R15.8-million in plant and property under the control of traditional councils.

Makwetu also found that the entity’s accounting regimen did not pass muster.

Makwetu said the strike by the entity’s staff “resulted in a significant limitation being imposed on the audit that leadership was unable to resolve. This was due to ineffective oversight over human resource management by leadership.’’

In her foreword to the report, Dube-Ncube said the audit outcome was “disappointing’’, blaming it on the strike taking place ‘“during audit season’’.

“We have put in place a response plan, which will ensure that we address this as a matter of priority going forward,’’ she said.

The department’s accounting officer, Thando Tubane, said that, because most of the councils still used a manual receipt and cash book system, the “risks associated with financial fraud, receipt manipulation and cash book reconciliation errors are inherently high”.

Tubane said 110 of the councils had been assisted in setting up point-of-sale technology to improve record-keeping.

Serious problems with the payment of the province’s more than 2 00 izinduna, whose back pay — to the tune of R1.2-billion — is being funded by cuts from the budgets of other provincial departments, were also uncovered by Makwetu.

The department received a qualified audit of the payments to izinduna, who receive about R8 00 a month. They were awarded back pay in 2014 by then-president Jacob Zuma. The province is still struggling to find about R224-million a year for this purpose.

In a report tabled to the province’s standing committee on public accounts last Friday, Makwetu found that the department paid 29 dead izinduna R368 700 in salaries.

He also found that the department paid R6-million to 78 izinduna who were employed by other government departments. Another 37 izinduna were wrongly paid R2-million by receiving more than their official salaries.

Seven others, who collectively received another R4-million, could not be verified.

“The accounting officer did not implement sufficient monitoring controls over the identification, recording and payment of izinduna, resulting in the qualification of the financial statements,’’ Makwetu said.

By: Mail & Guardian
This report does not necessarily reflects the opinion of SA-news


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Categories: Corruption, Expenses, News, SA News, South Africa News

Tags: accounting system, Africa, amakhosi, audit, expenses, Finance, government, levies, money matters, New South Africa, Politics, South Africa, traditional authorities, Traditional Levies and Trust Account, tribal councils, trusts

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