R1, 5bn North West Housing Funds cannot be accounted for!

Chris Hattingh MPL

North West Democratic Alliance Provincial Leader

The North West Standing Committee on Public Accounts (NW SCOPA) interrogated the North West Department of Human Settlement during a public hearing held in Mahikeng this afternoon on the Auditor General’s (AG) Report on the Department.

In the Report it was revealed that the AG “was unable to obtain sufficient appropriate audit evidence for R1 581 976 000 paid to municipalities”. The amount disclosed during the previous audit, R516 411 000, therefore increased dramatically with more than R1bn as disclosed during the audit findings currently under review. The Department alleged that after the transfer of these funds, destined to build houses in a Province in dire need thereof, municipalities “failed to provide the Department with documentary proof of these funds. The Department failed to provide reasons for not exercising any control over the expenditure of the housing funds.

It was reported that not even an Audit Team visiting each NW municipality could extract these documentary proof of the expenditure highlighting the extent of the lack of financial control in the NW – spanning from the Provincial Government into each NW Municipality. This leaves the Department in a desperate situation where they can only account for R1 015 670 118 (39.19%) of the total of R2 591 567 862 earmarked for housing transferred to NW Municipalities.

The NW SCOPA further confronted the Department on the high level of vacancies in its Finance Section where only 47% of the positions were filled. The lack of financial capacity and financial control appeared to have played a major role in the North West Housing scandal. In a rare admission the Department admitted that in many municipalities the quality of houses that has been build leaves a lot to be desired.

It is even more shocking that after the Department of Human Settlements and its predecessor, The Department of Local Government and Housing, boasted year after year about increased NW housing delivery, an investigation about the expenditure of more than 60% of housing funds transferred to municipalities needs to be done including the “physical verification of structures built by municipalities”.

The reality is that in the North West Province the poorest of the poor are remaining the victims of a system, now almost totally rendered incompetent through the vicious deployment of un- or under qualified and inexperienced cadres, not able to properly account on its finances or to deliver quality products.

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