awarding of R14.5 million in housing subsidies by the Limpopo Department of
Housing
4 April 2006
The Auditor-Generalâs performance audit of the approval and allocation of
housing subsidies by the Limpopo Department of Housing has highlighted
discrepancies of almost R14.5 million in subsidy allocation. In addition,
exception reports highlighting further potential irregularities to the value of
R14.1 million were handed over to the department for further investigation.
These figures were revealed in the performance audit report tabled on Tuesday,
4 April 2006.
The figures are based on a calculated potential amount of R15 000,00 per
applicant and were found in 4891 exceptions out of a national total of 53 426.
Of the 119 595 beneficiaries approved in Limpopo irregularities found are:
1. 999 applicants are government employees earning salaries in excess of the
housing subsidy threshold (national figure: 7 353)
2. 300 subsidy approvals after the applicantâs date of death (national figure:
5 335)
3. 172 duplicate subsidy approvals for the same applicant and 341 duplicate
subsidy approvals for the same household (national figures: 1 618 and 1 981
respectively)
4. 515 potential instances where subsidies were approved for individuals under
the age of 21 (national figure: 6 708)
5. 9 potential instances of subsidies awarded to individuals receiving monthly
payments from the Government Employee Pension Fund (national figure: 111)
6. 416 potential instances of subsidy approvals to applicants with invalid ID
numbers(national figure: 4 471)
7. 2 139 potential instances of duplicate subsidies approved for the same
property (national figure: 25 849)
âThe purpose of this report is to facilitate public accountability by
bringing the irregularities and limitation in the current low-cost housing
subsidy process to the attention of the legislature and to assist in improving
service delivery and value for the tax payersâ money. It is further hoped that
this report will enable the Limpopo Department of Housing to take the
corrective steps required to improve the management measures, controls,
processes and systems in the approval and allocation process of low-cost hosing
subsidies,â said the Auditor-General, Mr Shauket Fakie.
Like Limpopo, separate reports on audits conducted in the other eight
Provincial Housing Departments have been or will be submitted to the respective
provincial legislatures for consideration. Most of the findings originated from
deficient management measures that were generic throughout. It is hoped that
the reports will assist the provincial housing departments in identifying
subsidy applicants who should not have received a housing subsidy or who should
have received a reduced subsidy in accordance with the national housing
code.
Inadequate management measures identified include the following:
1. Applicants made misrepresentations and supplied outdated information to the
department on their subsidy application forms.
2. Officials manipulated the Housing Subsidy System (HSS) without proper
verification of the electronic search results. Therefore, subsidies were
awarded to applicants who did not quality for a housing subsidy.
3. Subsidy application forms were not always verified for correctness and
completeness by users and system administrators.
4. The HSS system failed to detect that applicants were deceased at the time
that the subsidy application was approved.
5. The department did not have adequate management measures to ensure the
safekeeping of completed subsidy application forms. In his response the head of
the department indicated that action will be taken against those officials who
have defrauded the government. Mandated by the Constitution of the Republic of
South Africa, 1996, the Auditor-General of South Africa is responsible for the
auditing of national and provincial state departments and administrations, all
municipalities and any other institution or accounting entity required by
national and provincial legislation to be audited by the AG. Its purpose is to
promote public accountability in all tiers of government. As an independent
organisation, the Auditor-General is answerable and accountable only to
Parliament.
Enquiries:
Adri van der Merwe
Business Executive: Reputation and Stakeholder Management
Auditor-General of South Africa
Tel: (012) 426 8175
Cell: 082 787 5291
E-mail: adrivdm@agsa.co.za
Website: http://www.agsa.co.za
Issued by: Auditor-General
4 April 2006
Source: Auditor-General of South Africa (http://www.agsa.co.za)
