awarding of R7,7 million in housing subsidies by the Northern Cape Department
of Housing
5 April 2006
The Auditor-Generalâs performance audit of the approval and allocation of
housing subsidies by the Northern Cape Department of Housing has highlighted
discrepancies of almost R7,7 million in subsidy allocation. In addition,
exception reports highlighting further potential irregularities to the value of
R2,8 million were handed over to the department for further investigation.
These figures were revealed in the performance audit report tabled on
Wednesday, 5 April 2006.
The figures are based on a calculated potential amount of R15 000,00 per
applicant and were found in 898 exceptions out of a national total of 53 426.
Of the 32303 beneficiaries approved in Northern Cape irregularities found
are:
* 90 applicants are government employees earning salaries in excess of the
housing subsidy threshold (national figure: 7 353)
* 360 subsidy approvals after the applicantâs date of death (national figure: 5
335)
* 26 duplicate subsidy approvals for the same applicant and 40 duplicate
subsidy approvals for the same household (national figures: 1 618 and 1 981
respectively)
* 71 potential instances where subsidies were approved for individuals under
the age of 21 (national figure: 6 708)
* 115 potential instances of subsidy approvals to applicants with invalid ID
numbers (national figure: 4 471)
* 196 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 Northern Cape 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 Northern Cape, 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 include the following:
* Applicants made misrepresentations and supplied outdated information to
the
department on their subsidy application forms,
* 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,
* Subsidy application forms were not always verified for correctness and
completeness by users and system administrators,
* The HSS system failed to detect that applicants were deceased at the time
that the subsidy application was approved,
* The department did not have adequate management measures to ensure the
safekeeping of completed subsidy application forms.
The head of the department indicated that a separate unit will have to
investigate the cases mentioned in the report and such unit should form part of
the anti-corruption strategy of the department. 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
5 April 2006
Source: Auditor-General of South Africa (http://www.agsa.co.za/)
