National Treasury entities repeatedly fail to achieve clean audits

16 October 2024

ActionSA will write to the Chairperson of the Standing Committee on Finance, Dr Mkhacani Maswanganyi, to urgently summon the nearly 40% of National Treasury entities (6 out of 16) that failed to achieve clean audit reports, to appear and account before the Committee.

Following a briefing by the Office of the Auditor-General to the Standing Committee on Finance, ActionSA is concerned about the poor audit outcomes of entities reporting to National Treasury and given that National Treasury is the custodian of good governance, it is unacceptable that so many of its entities failed to achieve clean audit reports.

Alarmingly, the entities that failed to secure clean audits include the Public Investment Corporation (PIC), Financial and Fiscal Commission, Government Pension Administration Agency, Land Bank, Land Bank Insurance Company, and Land Bank Life Insurance Company.

Of particular concern is the PIC's repeated failure to obtain a clean audit. With over R3 trillion in funds under management, including the Government Employee Pension Fund, it is shocking and unacceptable that an entity of this magnitude cannot ensure proper financial management and accountability.

As highlighted in the briefing, the PIC remains one of the entities whose audit findings have not improved from previous years. The Auditor-General notes that “the entity continues to struggle with compliance with legislation, as prior year action plans failed to adequately address significant internal control deficiencies”.

Beyond the poor audit outcomes, ActionSA is further concerned by the Auditor-General’s indication of the persistent failure of various entities to achieve their performance targets. National Treasury itself met only 79% of its targets, while the PIC achieved just 64% of its planned targets.

ActionSA believes that, given their vital role, National Treasury and its related entities must be beyond reproach and serve as the bastion of good governance, as well as sound financial and performance management.

ActionSA believes that National Treasury’s failure to account and correct course will not only undermine public trust but also jeopardise the financial stability and integrity of the entire public sector. This is especially concerning given the potentially disastrous consequences for members of the Government Employees Pension Fund (GEPF), whose life savings and contributions could be severely compromised by such abject accountability and audit compliance.

In light of the serious concerns that have arisen, ActionSA’s request for an urgent Standing Committee on Finance hearing with National Treasury and its related entities is critical to address the glaring lapses in upholding these standards.

Issued by Alan Beesley, Member of Parliament, ActionSA, 16 October 2024