Parliament, Wednesday, 7 October 2026 – The Portfolio Committee on Health resolved not to receive the presentation on the National Health Laboratory Service (NHLS) annual report after committee members unanimously raised grave concerns about the entity’s failure to submit audited financial statements, chronic non-compliance with the Public Finance Management Act (PFMA) and what members described as a collapse of governance and board oversight.
The committee met today to receive a briefing from the NHLS on its governance, accountability and internal controls.
Committee Chairperson Ms Faith Muthambi said: “We are very concerned about what is happening at the NHLS. We are concerned because we believe this entity is the lifeline of our country’s health system. We are here today to consider the entity’s annual report, yet there are no audited financial statements.” Ms Muthambi added: “These are symptoms of a delinquent board that cannot perform its functions.”
Members of the committee noted with concern that the board had failed to meet the statutory deadline of 31 May for submitting its report in accordance with section 55 of the PFMA. The NHLS submitted the report two months later, on 29 July. The committee further stated that, under section 55 of the PFMA, the board is legally required to submit an annual financial report and that failure to do so constitutes a breach of its statutory obligations.
Members indicated that this failure leaves Parliament unable to fulfil its constitutional duty to evaluate performance and financial management. The committee said the NHLS finds itself in a state of chronic instability because non-submission or late submission of reports has persisted over the past three years.
Members of the committee observed with regret that the entity’s leadership appeared intent on undermining it. Some committee members expressed the view that the intention of the board and its executive was to dissolve this important institution so that individuals could benefit in the private sector. Members said they held this view because the NHLS received disclaimer audit opinions in 2024 and 2025, despite claims of an improved outcome for 2025/26.
The committee reiterated that the NHLS presentation explicitly noted that the 2025/26 annual financial statements remained incomplete, unaudited and overdue. There has been continuous turnover in leadership, with chief financial officers suspended or dismissed in 2020 and 2026, and appointments taking several years. Weak IT controls, flawed access controls and data-integrity failures directly compromised the audit evidence needed by the Auditor-General of South Africa.
Committee members proposed a formal inquiry into the board to investigate the situation.
The committee said the NHLS was unwilling to act on its recommendations and advice and that discussing issued addressed in previous meetings was counterproductive. Despite various meetings with the NHLS, the situation has deteriorated.
The NHLS received a disclaimer audit opinion, indicating serious and persistent internal-control and governance failures, even though the committee had raised these matters months earlier. Members asked why the committee should continue to have confidence in the board and its ability to exercise effective oversight over the NHLS. They recommended that it be recognised that the board members had failed in their fiduciary and PFMA responsibilities.
During its deliberations, the committee said it could recommend that the Minister consider the appropriate statutory processes concerning the board members. The committee indicated that the delinquency of the board was extremely worrying, given that the NHLS operates in one of the most important sectors of healthcare and provides critically important service for healthcare and criminal investigations.
Members proposed that the Minister should also brief the committee on the steps he had taken to intervene in the entity.
Summing up the discussion and outlining the way forward, Ms Muthambi said: “We have made recommendations in the past. Indeed, there were times when we spent the whole night with this entity. We have done what we could to support this institution. But ultimately, I believe it is the executive and the board that are failing in their fiduciary duties.”
“These problems did not begin today,” Ms Muthambi said. “Therefore, once the Auditor-General has finalised the audit, I believe we should set aside a full day for a fact-finding mission. The department must brief us on its intervention mechanisms and explain the board’s failure to fulfil its legal and fiduciary duties. We cannot allow this to continue. When I consider the credentials of these esteemed board members and the board’s executive, I am stunned and ask what is actually happening.”
“Why should there be governance failures under these circumstances? I think there is more that requires closer scrutiny, and we will set aside a day for this purpose. We will not be considering this report. We are concerned that you are neglecting your fiduciary duties, and we believe something must be done. We cannot continue like this.”
“We would be failing in our oversight responsibility as members of Parliament if we allowed this malfeasance within the board to continue”, said Ms Muthambi.
ISSUED BY PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE PORTFOLIO COMMITTEE ON HEALTH, MS FAITH MUTHAMBI.
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