The Gauteng Health Department has been lambasted by the Auditor-General (AG) for R2.26bn irregular expenditure in the 2022/2023 financial year, R15m fruitless and wasteful expenditure, and failing to spend R2.7bn of its budget.
DA Gauteng health shadow MEC Jack Bloom revealed this on Monday, after the Health Department’s annual report for 2022/2023 was tabled in the legislature last week, covering the period from 1 April 2022 to 31 March this year.
The AG said R3.1bn of patients’ debt was written off, and 26 293 invoices for R2.5bn were undisputed, but still not paid after 30 days or the agreed period. Only 53 850 invoices (35%) out of 154 076 were paid within the legally required 30 days, reports News24.
These non-payments were due to cash shortages because of medico-legal payments and settlement of old accruals, over-commitment on goods and services procured, as well as delays in clearing web-cycle transactions, according to the department.
However, the AG said effective and appropriate steps were not taken to prevent irregular expenditure, most of which was due to failure to invite competitive bids. Disciplinary steps were also not taken against the officials responsible.
One of the reasons for fruitless and wasteful expenditure, said Bloom, was the failure to pay court orders within 30 days, meaning interest had to be paid on the outstanding amount.
Another concern was that the department had unreliable information about meeting targets, in some cases claiming falsely to have achieved them, he added.
The AG noted that 75% of the budget for health facilities management was spent, but no targets were achieved.
Added Bloom: “The report shows little progress has been made in fixing the appalling financial mismanagement that allows criminal syndicates to flourish. This includes the R1bn in irregular expenditure the SIU has identified at Tembisa Hospital alone, since the murder of Babita Deokaran.
The previous week, Premier Panyaza Lesufi had claimed departments were getting better audit reports, but failed to acknowledge the glaring deficiencies in the department, added Bloom
“He should strive for real achievement instead of claiming false victories."
While few Gauteng Government departments received clean audits for the past financial year (only six of them managed this), Health MEC Nomantu Nkomo-Ralehoko said she was satisfied with her department’s unqualified audit, according to a second News24 article.
The achievement was a good sign, she added, even though she was unhappy they did not get a clean audit, but they were working to improve the financial situation at troubled hospitals.
“Every month end, we have management meetings to assess the work done at each hospital. Our priorities were Tembisa, Leratong and Dr George Mukhari … with irregular expenditure and not following protocols under the Public Finance Management Act.
Internal control systems had been tightened in some hospitals to improve financial stability, she added, and monthly executive meetings were held, at which hospital CEOs had to share financial reports.
The department also had a programme on asset management.
“Some hospital equipment bought did not have strong asset management, and …people would steal those machines. We don’t want people even moving chairs from one office to another. We are now very strict regarding machinery and equipment,” she said.
Lesufi said the department had turned the corner in the past three years, that 1 600 senior managers and officials in supply chain management and human resources management were subjected to a vetting process.
The department also curbed officials’ practice of splitting orders to avoid going to tender.
“The SIU is investigating cases of abuse. All purchases between R500 000 and R1m are forwarded to the Gauteng Provincial Treasury for verification and to ensure they comply with supply chain management prescripts.”
Quotation adjudication committees had also been established in all institutions.
See more from MedicalBrief archives:
Gauteng to probe R708m in ‘irregular’ hospital security contracts
Gauteng Health on the right track, MEC tells Scopa
Tembisa Hospital audit buried for a year and recommendations ignored