1. Background
The finalisation of cases of financial misconduct is key to accountable and transparent Public Service. The Public Service Commission (PSC) has since 2001/02 financial year, been monitoring finalised cases of financial misconduct reported to it by both national and provincial departments.
Accordingly, the PSC releases a Fact Sheet on finalised cases of Financial Misconduct which provide a statistical overview of finalised cases of financial misconduct reported by both national and provincial departments for the 2011/12 financial year and trends analysis of cases reported since the 2008/09 financial year.
2. Key findings
|
Provinces |
Amount involved |
Amount recovered |
No loss to the state |
Amount not recovered |
|
Eastern Cape |
R13 486 131.96 |
R116 600.00 |
R3 108 590.30 |
R10 260 941.66 |
|
Free State |
R1 850 952.61 |
R9 400.00 |
R1 417 039.00 |
R424 513.61 |
|
Gauteng |
R14 135 915.07 |
R27 058.84 |
R8 165 254.46 |
R5 943 601.77 |
|
KwaZulu-Natal |
R39 044 977.38 |
R81 649.68 |
R1 453 341.00 |
R37 509 986.70 |
|
Limpopo |
R2 194 429.30 |
R992 910.81 |
R123 419.66 |
R1 078 098.83 |
|
Mpumalanga |
R3 829 365.35 |
R70 211.31 |
R955 225.93 |
R2 803 928.11 |
|
National |
R149 407 626.99 |
R946 447.83 |
R133 593 365.58 |
R14 867 813.58 |
|
North West |
R731 536.37 |
R39 487.83 |
R307 099.82 |
R384 948.72 |
|
Northern Cape |
R486 907.23 |
R27 299.00 |
R10 855.10 |
R448 753.13 |
|
Western Cape |
R4 698 920.89 |
R30 060.00 |
R1 245 390.35 |
R3 423 470.54 |
|
Total |
R229 866 763.15 |
R2 341 125.30 |
R150 379 581.20 |
R77 146 056.65 |
The PSC found that the amount of R229 866 763.15 reported by national and provincial departments as a result of financial misconduct, emanated from unauthorised, irregular, fruitless and wasteful expenditure in respect of the 2011/12 financial year.
The reports submitted by national and provincial departments indicated that an amount of R2 341 125.30 (1.1%) was recovered from the employees found guilty of financial misconduct and an amount of R150 379 581.20 (65.4%) was considered as no loss to the state. At the time departments reported to the PSC (1 April 2011 to 31 March 2012), it was indicated that an amount of R 77 146 056.65 (33.5%) had not been recovered.
2.1. National Departments
The PSC found that the amount involved in financial misconduct reported by national departments was R149 407 626.99. The cost of financial misconduct was the highest in the Department of Human Settlements R100 001 500.00, which represents 66.9%, of the total cost reported by national departments.
The high cost reported by the Department of Human Settlements related to an amount of R100 000 000.00 emanating from 1 case involving a contravention of section 38 (1) (n) of the Public Finance Management Act (PFMA).
The department that reported the second highest cost of financial misconduct was the Department of Home Affairs with an amount of R11 998 482.16 (8%). Furthermore, the Department of Science and Technology reported that it finalised 1 case of financial misconduct but did not indicate the cost. The Department of Mineral Resources reported the lowest cost of R5 475.49 (0.003%).
2.2. Provincial departments
The study shows that the amount involved in respect of financial misconduct reported by provincial departments for the 2011/2012 financial year was R80 459 136.16. The KwaZulu-Natal Province reported the highest cost of financial misconduct amounting to R39 044 977.38.
This is equivalent to 48.5% of the total cost of financial misconduct reported by provinces. The study further found that Gauteng Province reported the second highest amount with regards to the cost of financial misconduct, R14 135 915.07 representing 17.6% of the total cost of financial misconduct reported by provinces. The Northern Cape Province reported the lowest amount of R486 907.23 (0.6%) as a result of financial misconduct.
Criminal Proceedings instituted against employees charged with financial misconduct
The PSC found that for the 2011/2012 financial year, of the 953 cases in which employees were found guilty of financial misconduct, criminal proceedings were instituted against employees in 305 (32%) of the cases.
In 263 (27.6%) cases, departments indicated that no criminal proceedings were instituted against employees because not all acts of financial misconduct will result in criminal or civil action being taken against an employee.
The report shows that in 384 (40.3%) of the cases, the departments failed to indicate whether criminal proceedings where instituted against employees charged with financial misconduct. Furthermore, in 1 (0.1%) case the department indicated that further action was not applicable.
Conclusion
The PSC notes that the high numbers of Public Service officials that commit and get charged with financial misconduct is increasing at an alarming rate. Although there has been a decrease in the amount involved in the respect of financial misconduct in comparison with the previous financial year (2010/11), the number of employees charged for misdemeanours relating to financial misconduct in the 2011/12 financial year has increased by 25%.
Departments should put control systems in place to prevent financial misdemeanours. The PSC trusts that the overview and trend analysis provided in this Fact Sheet will assist departments to keep a vigilant eye on areas that are susceptible to financial misconduct and tighten internal controls.
For enquiries:
Ricardo Mahlakanya, Deputy Director: External Communication
Cell: 079 769 7955
Tel: 012- 352 1070
E-mail: ricardom@opsc.gov.za
Humphrey Ramafoko
Director: Communication and Information Services
Cell: 082 782 1730
Tel: 012 352 1196
E-mail: humphreyr@opsc.gov.za
