Parliament, Friday, 12 September 2025 - The Standing Committee on the Auditor-General (SCoAG) notes the interventions by the National Treasury to recover debt owed to the Auditor-General of South Africa (AGSA). As at 31 July 2025, the total outstanding debt to the AGSA stood at R1.83 billion, up from R1.35 billion in March 2025.
Accountant-General, Mr Shabeer Khan, briefed the committee today on the root causes of the debt and the interventions underway for debt repayment and to encourage financial accountability in all state institutions. Of the current R1.83 billion outstanding debt to the AGSA, municipalities owe R437 million and state-owned entities (SOEs) owe R644 million.
Long-standing debtors include DENEL who owes R82 million, the South African Post Office owes R63 million, South African Express owes R21 million, Pelchem owes R11 million, Autopax owes R6 million, and Mango Airlines owes R2 million. A concern of the committee is that, some of these SOEs are under business rescue or liquidation.
The committee welcomes the escalation of the National Treasury’s interventions using Section 216 (2) of the Constitution, which empowers it to withhold funds from municipalities that breach the Municipal Finance Management Act (MFMA). In December 2024, after National Treasury issued warning letters, R460 million was collected from municipalities.
In March and July 2025, National Treasury withheld portions of the Local Government Equitable Share for municipalities failing to pay. Funds were only released in instalments once proof of payment to the AGSA and other creditors was provided. This has forced several municipalities to enter into payment arrangements with the AGSA, though some still refuse to comply.
The committee, however, calls for avenues other than withholding municipalities' equitable share, as this is detrimental to service delivery, and implores National Treasury to explore interventions aimed at ensuring that municipalities budget properly for the audit fees. Further discussions will also take place on alternative methods of appropriating for these audit fees whilst still protecting the independence of the AGSA.
The committee is pleased with the collaborative monitoring of National Treasury and AGSA to track defaults, enforce payment conditions, and recommend write-offs where entities are in liquidation.
ISSUED BY THE PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE STANDING COMMITTEE ON THE AUDITOR-GENERAL, MR WOUTER WESSELS.
For media enquiries, please contact the committee’s Media Officer:
Name: Ms Faith Ndenze
Parliamentary Communication Services
Cell: 081 377 0686
Email: fndenze@parliament.gov.za
Arrange a tour