The Portfolio Committee on Health received a briefing yesterday from the Auditor-General (AG) of South Africa for an analysis and assessment of the Department of Health’s strategic and annual performance plans (APPs) and budget.
The AG’s report gave an overview of whether the department’s indicators are well defined, measurable and aligned with its APP. It also reported on other related compliance measures related to governance and management of its budget. It flagged a lack of accountability on key internal audit controls, which have resulted in wasteful and fruitless expenditure. This has created stagnation in the department’s financial management in the year under review.
The AG’s report also highlighted inadequate internal oversight over financial and performance management reporting and compliance. “This is exacerbated by the slow response from the accounting officers and senior management to implement the action plans to effectively address the deficiencies in internal controls,” the report said.
A lack of proper records management is another ongoing concern. “This is not done in a timely manner that is complete, relevant and provide accurate information, accessible manner to support financial and the performance reporting of the department.”
In addition, little is being done to prevent irregular expenditure, fruitless and wasteful expenditure. This concerned members of the committee, particularly in light of its key role in fighting the Covid-19 pandemic and exacerbated by the fact that its targets and budget will change significantly in line with that responsibility. They asked how the department’s budget and financial performance will account for the R20 billion stimulus package allocated to it, if its internal audit controls are ineffective.
The AG team advised the department to adjust its APP to comply with the AG’s recommendations regarding the department’s internal audit controls and consequence management. The AG’s status of records review provides guidelines on what the department needs to do to ensure that its financial management, supply chain, and monitoring and evaluation in order.
The AG’s report also revealed that critical posts for financial officers, supply chain management and monitoring and evaluation remain vacant, especially in provinces. These vacancies could contribute to the supply chain management and monitoring and evaluation problems.
The report also painted a poor picture of financial, information technology and compliance management. The AG’s report indicated that the department had not improved in these areas since last year.
The AG team told the committee that they have been working with the department to help it institute corrective measures to improve on its financial reporting and management before the AG’s final audit report for the year.
Members of the committee asked how the new powers assigned to the AG in terms of the new Public Audit Amendment Bill will assist the AG in its work with departments. These new powers will allow the AG to initiate prosecution where necessary and to hold office bearers accountable for wrong doing. Furthermore, if material irregularities are identified, the AG will request the accounting officers concerned to act and hold those implicated accountable.
The AG report recommended that the committee should ensure that it “tracks the department’s interventions in its quest to prioritise the improvement of its financial control and management and its audit outcomes.”
The Chairperson of the committee, Dr Sibongiseni Dhlomo, commended the AG team for arming the committee with such information, which would help the committee to sharpen its interaction with the department in due course. He further added: “We also want to have frequent interactions with the AG to familiarise ourselves with the department’s progress. That will assist in strengthening our oversight over it going forward.”
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