Social Development must explain their poor audit outcome

by Isak Fritz – Northern Cape Spokesperson of Social Development

Date: 19 October 2017
Release: Immediate
Type: Press Statement

The DA notes with deep concern the regression in the audit outcome of the Northern Cape Department of Social Development.

The latest audit outcomes for 2016/2017 indicate that the department obtained a qualified report with findings. This comes after Social Development was the first provincial department to ever obtain a clean audit for the 2012/2013 financial year, after which it continued to receive clean audits for the next three years.

The deterioration of the department’s financial management is deeply disappointing. This department was hailed as the prime example of clean governance in the Northern Cape.

The DA notes that the main contributing factor towards the poorer audit outcome is the significant underspending of the R43 million grant for the substance abuse treatment centre. This stems from the delay in construction of the substance abuse centre due to a legal tryst resulting from the awarding of the contract.

While this has largely to do with the management of the contract by the Northern Cape Roads and Public Works Department, who is the implementing agent, Social Development should not lay all blame on their shoulders. This will place the already cash-strapped province at risk of losing out on funding, as rollovers of unspent grants are not guaranteed.

Departments have to stop working in silos and they must take responsibility for their own projects.

I previously asked the MEC and HOD of Social Development to please not let this project end up like the mental health hospital, which has taken more than ten years to complete at ever increasing costs. They promised that they would not allow this to happen and yet we find ourselves on the very same road.

Another disturbing finding in the Audit Report was that there are persons in service of the department who failed to disclose that they have close family members, partners or associates that had a private or business interests in contracts awarded by the department.

This is unacceptable. This is where corruption starts and should be the starting point in avoiding irregular expenditure.

The DA intends interrogating the department with regards to their audit regression when they come to present their Annual Report to the legislature committee in a few weeks’ time.

We will also write a letter to Premier Sylvia Lucas asking her to account for this failure. She was the one who chose to shuffle the once well performing administration of Social Development and place questionable officials from the poorly performing Health Department into senior financial management positions at the Social Development Department.

Our province cannot afford to move backwards – we have too few funds and too many people to allow for mediocrity in the Northern Cape provincial government.