Terence Nombembe, the Auditor General
Terence Nombembe, the Auditor General

The recent audit outcomes of local government in the Eastern Cape for the financial year ending 30 June 2012 once again highlights the declining state of municipal finances in our province, which in turn has a negative impact on service delivery.

This is particularly so in the case of supply chain management.

In the 2009/10 year the total amount of irregular expenditure in supply chain management was R839 million, in 2010/11 it was R1,38 billion and in 2011/12 it was R1,88 billion.

This is an increase of R 1,041 billion over two years, or an increase of 124 %.

In the context of a poor provincial economy and huge pressures on local government not one cent can be wasted on mismanagement and corruption.

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A point of major concern is the irregular expenditure associated with supply chain management, which involves 34 municipalities.

Unfair and uncompetitive procurement processes are the root cause of corruption and maladministration in this province. Tenders are often only awarded at the last minute so normal supply chain processes are bypassed. There is often a case where value for money is not received.

Public Accounts Committees need to interrogate irregular supply chain expenditure and hold officials accountable. Political interference which impacts negatively on the administration needs to be eradicated. The Auditor-General referred to 11 municipalities where this was having an impact.

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