PRETORIA – The office of the Auditor-General of South Africa (AGSA) has released its report on the performance audit of the infrastructure delivery process at the provincial departments of Education and Health in Parliament.
The audit focused on infrastructure projects that were completed recently or that were scheduled to have already been completed. For the purpose of this audit, infrastructure was defined as expenditure on land, buildings and other fixed structures, as well as major renovations. But this excluded expenditure on furniture, equipment and vehicles.
The provincial departments of Education and Health are responsible for infrastructure and the delivery of related services for their respective sectors. The budgeted expenditure collectively for these two sectors for infrastructure delivery amounted to R32 billion over the last three financial years. These departments are supported by implementing agents, usually the departments of Public Works, which play an important role in the planning, organising, monitoring and control of infrastructure projects.

Focus of the audit

The report focuses on three critical areas which require urgent corrective action by government - the process of needs determination and planning, which was found not to be effective, giving rise to unused and underutilisation of completed infrastructure; a robust procurement system, which was not consistently applied, thus compromising the transparency, accountability and economy with which decisions/commitments were made; and project management, which was not effective, resulting in projects that were not completed on time and at the required level of quality and cost.
The above deficiencies have resulted in millions of rands being inefficiently and ineffectively spent.
The Auditor-General (AG), Terence Nombembe, emphasised that the underlying causes of the identified deficiencies “include poor planning and coordination by and between departments, as well as a lack of skills and capacity within government to oversee complex infrastructure projects”.
Performance auditing plays an important role in improving financial management effectiveness and accountability in the public sector, and through these audits continues to contribute towards strengthening our country’s democracy.

Departments commit to immediately address deficiencies

The outcomes of the performance audit were shared with the management of the affected departments as well as the national departments of Basic Education, and Health. Constructive dialogue took place on the outcomes, and recommendations were well received. Management committed to immediate and drastic action to address the deficiencies detailed in the report, including investigations and constant follow-up on corrective action.
In addition to following up on corrective actions taken by auditees, future regularity audit coverage will include auditing the acquisition (supply chain management), project management and maintenance of material government projects across all sectors.
Province-specific reports will be tabled in the provincial legislatures. This report and the provincial reports will promote public accountability by providing the legislatures with the relevant information to enable them to provide oversight.

MEDIA NOTE: The complete Report on a performance audit of the infrastructure delivery process at the provincial departments of Education and Health is available on www.agsa.co.za
ABOUT THE AGSA: The Auditor-General of South Africa (AGSA) is the country’s supreme audit institution. It is the only institution that, by law, has to audit and report on how government is spending taxpayers’ money. This has been the focus of the AGSA since its inception in 1911 – the organisation will be celebrating its 100-year public sector auditing legacy this year (2011).