ATC240229: Sixth Report of the Standing Committee on Public Accounts on the unauthorised expenditure of Statistics South Africa (Stats SA) dated 28 February 2024.

Public Accounts (SCOPA)

Sixth Report of the Standing Committee on Public Accounts on the unauthorised expenditure of Statistics South Africa (Stats SA) dated 28 February 2024.

 

The Standing Committee on Public Accounts (the Committee) considered and heard evidence on the unauthorised expenditure of Stats SA in relation to previous years and reports as follows:

1. Background:

The Committee notes that Stats SA incurred unauthorised expenditures in the financial years of R37.842 million in 2017/18 ; R56.739 million in 2018/19; and R47.617 million in 2019/20; due to significant budget reductions​ on Compensation of Employees.

 

Overspending at economic classification level, particularly in instances where such overspending did not cause overspending in programmes to be reclassified as irregular expenditure.​

 

Unauthorised expenditure incurred by the department is mainly on the Compensation of Employees due to budget reductions implemented by the National Treasury.

1. Mitigating actions and steps taken to prevent unauthorised expenditure.

 

1. The Department placed a moratorium on the filling of positions as they became vacant between October 2016 and 2019/20.
2. The Department also implemented virements across programmes and economic classification, but not enough.
   • 2017/18 – Only shifted R9.385 million of R20.673 million (8 per cent virement threshold) from P5 – a further R11.378 million virement could have been implemented.​
   • Only shifted R5.558 million of R13.397 million underspending (7.1 percent of main appropriation) from P7 – a further R7.839 million virement could have been implemented.
3. Additional funding to cover filled positions provided from 2020/21.​
4. Organisational restructuring was also implemented – 98 vacant positions were identified as redundant and abolished.​

 

3.  Recommendations

Having considered the above matter the Committee recommends that:  

2017/18 ​

• R11.378 million be funded as a charge against funds allocated to the department for the future years, in accordance with section 34(2) of the PFMA, 1999. ​
• R26.464 million be financed as a direct charge against the National Revenue Fund in accordance with section 34(1)(a) of the Public Finance Management Act (PFMA), 1999​.

2018/19​

• R7.839 million be funded as a charge against funds allocated to the department for the future years, in accordance with section 34(2) of the PFMA, 1999. ​
• R48.900 million be financed as a direct charge against the National Revenue Fund in accordance with section 34(1)(a) of the Public Finance Management Act (PFMA), 1999.​

2019/20​

• The unauthorised expenditure should be financed as a direct charge against the National Revenue Fund in terms of section 34(1)(b) of the PFMA, 1999.​

 

4. Conclusion

The Committee further recommends that the Auditor-General follow up on all matters raised above and report in its audit outcome on unauthorised expenditure after the end of the 2023/24 financial year.

Report to be considered.