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NC’s fiscal health a concern – MEC

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'The Province closed with a negative bank balance of only R86 million at year end.'

Mac Jack. File image

THE MEC for Finance, Economic Development and Tourism, Mac Jack, lamented the deterioration of the fiscal health of the Northern Cape during his budget speech yesterday, where there is a projected overdraft of R530 million for the 2017/18 fiscal year.

“This is a cause for concern and we have acknowledged this risk as the executive council. While pressures in the health and education sector have contributed to this situation, we cannot absolve other departments from this problem,” said Jack.

He said that turnaround strategies would be introduced at all departments and public entities. “Various measures, including prudent cash management, are being implemented to stabilise the Province’s fiscal position.

“The Province closed with a negative bank balance of only R86 million at year end.”

Jack stated that they had not been able to stabilise personnel numbers over the past three years due to the moratorium on appointments, where only critical vacant and funded posts were filled.

“Provincial Treasury will continue to combat the infiltration of ghost workers through the compulsory biometric verification of newly appointed employees three months from appointment.”

He said that he found it disturbing that 68 percent of municipal managers and 26 percent of chief financial officers (CFOs) who were critical in steering municipalities, were serving in acting capacities.

“A report, recently released by National Treasury, indicates that out of 31 municipal managers only nine met the minimum competency levels, while only eight out of 31 CFOs met the minimum competency level. Of the 86 senior managers, only 19 meet the minimum competency level.

Jack added that they would assist municipalities in finding amicable solutions to financial management and good governance as well as with the implementation of repayment plans for Eskom and Water Board debt and debt collection for departments.

He said provincial government would have to increase the undertaking to set aside 30 percent of public procurement to small, medium and micro enterprises, co-operatives and township and rural enterprises.

“We have also embarked on a process to verify public servants who are conducting business with the state. Preliminary data indicates that 63 officials from provincial departments are conducting business with state. The relevant accounting officers have been informed and an investigation should be undertaken, and ultimately action should be taken urgently.

Jack called for random lifestyle audits to be conducted on all public representatives, particularly supply chain management, finance sections and senior managers.

“Together with the Department of Transport, Safety, and Liaison, we have commissioned a forensic audit that will be released before the end of July. We are also in the process of investigating irregular expenditure at the Department of Health. A report will be issued in due course.”

Total budget: R302 million

Administration: R100 million

Sustainable resource management: R68 million

Infrastructure management: R2.5 million

Financial governance: R36 million

Internal audit: R37 million.