The North West government has rejected claims that it failed to spend almost R500 million on services in the dilapidated parts of the province in the past financial year.
This comes after ActionSA leader in the province, Kwena Mangope, released a statement alleging that the provincial government was to return R419 million to the Treasury before the end of March.
“ActionSA is concerned that the North West government’s underspending of its budget will lead to poorer quality roads, worse healthcare provision, and ultimately fewer services to the most vulnerable in the province.
“We believe that the province’s underspent budget could have been used to improve the living conditions of thousands (of people) in the province and help to create an enabling environment for job creation,” said Mangope.
Mangope said returning the funds to the Treasury was an admission of failure by the provincial government.
However, the North West government has labelled the issue a “witch hunt.”
“This issue was handled by the provincial Treasury. The stated amount was simply based on malicious reports. The remainder of the budget had not yet been spent because the financial year had not ended.
“Unfortunately, some are referring to municipal funds when we all know that the financial year for municipalities ends in June. The province has done everything in its power to spend funds accordingly,” said Premier Bushy Maape’s spokesperson, Sello Tatai.
Tatai referred African Times to a statement issued by the provincial government on similar allegations that ActionSA has raised in its recent statement.
According to the provincial Treasury statement, there was no need to speculate how much was spent and how much wasn’t because the financial statements they submitted are yet to be audited.
“The provincial government would be in a better position to confirm the expenditure reports of departments (after the audit). It would be unfair to predict the outcome of expenditure for the current year before critical accountability processes are concluded.
“Further note that the financial year for municipalities ends on 30 June 2023. Therefore, it will be premature to pronounce any unspent funds for the current municipal financial year,” said the provincial Treasury.
The National Treasury told African Times that it was common for government entities to return funds that had not been spent.
“It is fairly common for funds to be surrendered to the National Revenue Fund. Whether a national department spends 98% of its budget or 78% of its budget, it all reverts back.
“In the case of provinces and municipalities, the Division of Revenue Act states that unspent conditional grant funds revert to the Revenue Fund, unless approved by the National Treasury,” said the National Treasury.
The Treasury further explained that there were various reasons why government entities would return money back to them.
“This could range from vacant posts that have not been filled, capital spending not going according to plan, delays in procurement, or weak planning. In some cases, there may even be efficiencies in the delivery of a project, resulting in savings.
However, the Treasury admitted that underspending hampered service delivery.
“The most obvious is that service delivery targets are not met. Budget reprioritisation will only be considered in the broader context of budget analysis and delivery performance.
“Budget cuts are not automatic… If there are efficiency gains, duplication of functions, or persistent underperformance over multiple years due to capacity to deliver. Budget performance is also measured against spending effectiveness,” the Treasury said.