Africa-Press – South-Africa. Despite incurring R1.4 billion in irregular expenditure, the chief financial officer (CFO) and board chairperson of Umgeni Water defended the flouting of procedures, saying 99% of services were still delivered to the bulk water supplier.
“The fact that expenditure is irregular does not mean the entity did not receive the service. It means you did not follow normal procurement processes or Treasury instructions to perform the particular service,” said newly appointed Umgeni Water CFO Thami Mkhwanazi.
He was answering questions at Durban’s Moses Mabhida Stadium on Thursday at a media briefing on the 2020-’21 annual report.
In justifying the mammoth irregular expenditure, Mkhwanazi said the entity had not lost that amount of money.
He said:
He, however, did not divulge details of contracts or officials who were responsible for the irregular expenses.
Instead, he said that investigations were carried out, and based on those, nine disciplinary matters were carried out and finalised.
He did not give details of the investigations.
The only information given to the media was that irregular expenditure of R937 million was “carried forward from previous years” and that R466 million incurred in 2020-’21 came from multi-year contracts.
Umgeni Water’s R1,4 billion irregular expenditure due to old contracts
“We tried to explain that a major portion of these irregular expenditures that we are sitting with relates to variation orders for contracts and projects that are already ongoing.”
Mkhwanazi lamented that while the contracts were irregular, work was done.
“The service is done, but we did not follow normal processes. Ninety-nine percent of the time services are performed, just an issue of non-compliance.”
Umgeni Water board chairperson Ziphozethu Mathenjwa attempted to explain the nine disciplinary cases that were completed, but also justified some of the actions of officials.
“Some [disciplinary processes] are not related to companies, some are actually positive.”
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She said in one case an engineer signed off on a project but “in our documentation, we indicated that only the head of the department is supposed to sign off”.
“Those are transgressions. What they did was not wrong. They were qualified to do it, but in our files, the head of the division has to sign off. They did good for the organisation but the process was not followed. In some cases, we had to revise the procedure.
“But in cases where it involves two people not following a specific process, we have gone through the disciplinary process and policy. Where the policy says suspension, then we suspend. I am confident we have applied the policy.”
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