By Moses Matenga | NewsDay |
President Emmerson Mnangagwa’s administration gobbled nearly $7 billion in unauthorised expenditure in 2019 owing to lack of accountability in line ministries, exposing the rot at the heart of the government’s financial management system, Auditor-General (AG) Mildred Chiri’s latest report has shown.
The report, on appropriation accounts and fund accounts, also showed that government was likely paying ghost workers because there was no proper register for civil servants.
“During the year under review, Treasury incurred unauthorised excess expenditure amounting to $6 806 340 654 as a result of unallocated reserve transfers made to line ministries amounting to $7 386 995 654. This exceeded the approved budget of $580 655 000 in contravention of section 305(5) of the Constitution,” the report read in part.
“Treasury as the manager of the public purse did not adhere to legal provisions on the sanctioning of excess expenditure by Parliament.
“Furthermore, I noted some variances between the schedule of unallocated reserve transfers from Treasury and the received transfer schedules of the same from the individual line ministries and the variances needed to be reconciled. I raised this issue in my prior year reports and the matter is recurring.”
The AG also said the Finance ministry made direct payments to various ministries without proper documentation, a situation open to manipulation.
“As reported in my 2018 report, the Finance ministry continued to process various payments to suppliers of goods and services on behalf of ministries without adequate supporting documentation.
“Resultantly, some ministries were disputing the figures for payment made on their behalf. For example, for the Public Service Labour and Social Welfare ministry, the journal vouchers supporting direct payments amounting to $1 411 090 were not availed for audit inspection and neither did the ministry provide creditors reconciliations to show the status of the creditors after the direct payments had been done.”
The Health ministry was also redflaged for “unsupported expenditure” and paid money to suppliers of goods and services without supporting documents.
“The Health ministry could not avail supporting documents paid. This was contrary to the provisions of section 81 of the Public Finance Management Act [Chapter 22:19] which require all source documents to be obtained and attached to vouchers.
Chiri also expressed concern over how funds that were transferred from the Transport ministry to the Infrastructural Development Bank of Zimbabwe (IDBZ) were utilised.
“I noted with concern that there was no evidence on how funds transferred from the Transport ministry to IDBZ in 2019 amounting to $657 500 000 were utilised as only two out of 85 projects were completed,” the report added.
“Furthermore, there was no system in place to track on how funds transferred to IDBZ by the ministry were supposed to be accounted for.”
Also, Chiri said, the Home Affairs ministry, through the Department of National Archives made payments amounting to $170 552 that were not supported by requests, receipts and goods received vouchers as proof that the recorded transactions really occurred.
“I could, therefore, not satisfy myself whether the expenditure was a proper charge to the vote. This is contrary to the provisions of section 59(15) of the Treasury Instruction 2019, which states that payments should be adequately supported.”
On salary reconciliations, she said: “The Salary Services Bureau (SSB) records for employment costs had a total of $29 762 918 while PFMS ledgers had a total amount of $27 967 054, resulting in a variance of $1 795 864 that was not reconciled.”
“Treasury circular B/1/88 dated June 5, 2018 requested directors of finance of line ministries to perform monthly reconciliations of billed amounts by SSB against employment cost expenditure shown in PFMS ledgers. No evidence was produced to show that monthly reconciliations were being done in compliance with the Treasury circular.”
“The risks/implications (of this are) salaries may be paid for services not rendered. The employment costs reported for the financial year under review may be misstated.”
She said in purchasing goods and services, there was no “full compliance with the Public Procurement and Disposal of Public Assets Act” which is still a challenge in a number of ministries.
“In many instances, direct purchases did not have written justifications for choosing the sole supplier. In other cases, the procurement management unit is yet to be set up.”
Chiri said the year-long delay in releasing her audit was caused by the COVID-19 pandemic that made it practically impossible to meet the statutory deadline of June 30, 2020.