R4 million in employee housing subsidies
12 September 2006
Pretoria - The Auditor-General's performance audit on the approval and
allocation of housing subsidies to municipal employees by the Mpumalanga
Department of Local Government and Housing has highlighted discrepancies of
more than R4 million in subsidy allocation.
These figures, based on an audit of nine municipalities in Mpumalanga, were
revealed in the performance audit report tabled in the Mpumalanga Provincial
Legislature.
Of the 525 beneficiaries approved, irregularities found were:
* 504 beneficiaries received housing subsidies while employed by a
municipality.
* Five officials did not qualify for housing subsidies as they earned more than
R42 000 per year. None of these officials declared their household income when
they applied for the subsidies.
* 35 employees were awarded full housing subsidies instead of reduced
subsidies. These officials qualified for housing subsidies as they earned less
than R42 000 a year, but they did not declare their household incomes when
applying for subsidies. This non-disclosure resulted in them getting full
subsidies.
* 15 officials declared lower household incomes when they applied for
subsidies. This resulted in these employees being awarded higher subsidy
amounts.
* Payroll information of 435 officials could not be obtained from the
municipalities to verify their eligibility for housing subsidies. However,
information received from the Housing Subsidy System (HSS) and subsidy files
reveals that 113 of these officials did not declare their household income.
This poses a risk that applicants could have been awarded wrongful housing
subsidy amounts.
* A further 21 beneficiaries received housing subsidies while their spouses
were employed by a municipality. It could not be verified if these employees
qualified for subsidies since payroll information of their spouses could not be
obtained from the municipalities. It was identified that 18 of these
beneficiaries had not declared their spouses' income when applying for a
subsidy.
* The audit also identified 59 cases where properties have been approved for
transfer to new beneficiaries but have not been transferred a year after the
approval process. Some of these properties were approved as far back as 1995
but were still not registered in the names of beneficiaries.
Says Auditor-General Shauket Fakie: "The purpose of this report is to
facilitate public accountability by bringing the irregularities and limitation
in the current housing subsidy process to the attention of the legislature, and
to assist in improving service delivery and value for the taxpayers'
money."
"It is further hoped that this report will enable the Mpumalanga Department
of Local Government and Housing to take the corrective steps required to
improve management measures, controls, processes and systems in the approval
and allocation process of housing subsidies."
Enquiries:
Africa Boso
Tel: (012) 426 8273
Cell: 082 889 9527
Email: africab@agsa.co.za
Issued by: Auditor General of South Africa
12 September 2006
Source: Auditor General of South Africa (http://www.agsa.co.za)
