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How Much Money Has The South African Government Wasted?

Author: Jason Snyman
Date: 2019-02-12
There is money in this country, but the national, provincial and local governments have been squandering it for years. Just how much have they put down the drain with unauthorised, irregular, fruitless and wasteful expenditure?

In the last five years, the South African government has managed to waste R296 billion worth of unauthorised and idiotic expenditure. This is according to the reports of Auditor General, Kimi Makwetu, which show how national, provincial and local governments have been grossly mismanaging public funds.  

Some of Makwetu’s findings in the latest audit reports include a 121% increase in irregular expenditure between 2014/15 and 2017/18, a 68% increase in unauthorised expenditure between 2014/15 and 2017/18 and a massive 236% increase in fruitless and wasteful expenditure between 2014/15 and 2017/18.

A culture of no consequences has been created through the leadership’s involvement in the decision making that led to transgressions,” he said
The continued disregard for procurement processes by the leadership that resulted in irregular expenditure, coupled with limited consequences for the transgressions, created an environment vulnerable to misappropriation, wastage and the abuse of state funds.

If you’ve been following the news at all – and we wouldn’t blame you if you haven’t – you’ll know that state-owned enterprises have had their fingers in the public purse for years now, draining us dry. 

The Auditor General’s latest annual report revealed that government entities incurred over R51 billion’s worth of irregular expenditure last year. This is excluding the R28.4 billion in irregular expenditure by the country’s two biggest money-wasters, Transnet and Eskom, who had their auditing carried out by private firms. 

Furthermore, contracts to the tune of R6.5 billion could not be audited last year, due to incomplete or missing information. 

State-owned entity’s found to be knocking on death’s door included Alexkor, the Trans-Caledon Tunnel Authority and Broadband Infraco, while the SABC, PetroSA and the SA Post Office were deemed as possibly unable to continue operations without the Treasury holding their hand. 

Let’s take a look at the how our money is being squandered. 

The Biggest Money-Wasters In The Country

The departments of education, water / sanitation, health and public works – and the programmes they run, meant to improve the health and welfare of South African citizens – are responsible for over half of departmental budgets, and continue to deliver the poorest outcomes. 

In unauthorised expenditure by provincial departments, education accounted for almost R1 billion alone, followed by water and sanitation at almost half a billion and health at R275.1 million. 

“The financial health of the provincial departments of health and education needs urgent intervention to prevent the collapse of these key service delivery departments. In comparison with other departments, these sectors were in a bad state,” said Makwetu.

Unauthorised expenditure, for those who don’t know, is classified as either the overspending of a budget vote, or expenditure made that is not in accordance with the very purpose of a budget vote. 

Across all audits, unauthorised spending totalled at R2.12 billion, with the Eastern Cape responsible for R1.7 billion of that alone. The Free State, according to Makwetu, had already spent 78% of its 2018/19 operating expenditure budget back in 2017/18.

Here are the ten worst culprits of unauthorised expenditure:

The departments of health and education didn’t fare too well in irregular expenditure either, managing to blow R5 million and R3.8 million, respectively, on who knows what.

Here are the ten worst rampant, irregular spenders, with Eskom, of course, taking the top spot: 

And when it comes to fruitful and wasteful expenditure, which can be defined as any expenditure made in complete vain (hello there, E-Tolls) and which could have been avoided had people just used their brains, the government managed to throw R2.6 billion down the drain.

And finally, when we tally it all up, we end up with the ten worst money-wasters in the country. Black holes, forever hungry, ever failing and making a complete burden of themselves. It’s sad to see the likes of health, education, water and sanitation or roads and transport on this list, but alas, when you have a government of complete and utter imbeciles in place…

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