Swazi Media Commentary: Central Transport Administration

Showing posts with label Central Transport Administration. Show all posts

Tuesday, 13 November 2018

Tens of millions lost to banking fraud in Swaziland, but outstripped by Government corruption

Swaziland / Eswatini lost E30 million from the economy because of fraud during the past year, the kingdom’s national police Deputy Commissioner Mumcy Dlamini said.

She told an event for International Fraud Awareness week on Monday (12 November 2018) this was mainly connected to ‘banking sector business’.

She said fraudulent activities involve electronic fund transfers and false banking instructions.

However, she did not reveal the extent of fraud within the public sector which far outstrips that in private business. Earlier this year the Swaziland Auditor General exposed widespread financial irregularities across many government ministries.

Acting Auditor General Muziwandile Dlamini said in an annual report that financial accounts were incomplete, billions of emalangeni were unaccounted for and laid-down rules, guidelines and procedures were ignored. The offices of the Prime Minister, National Commissioner of Police, Defence Department and Correctional Services were among a string of government departments and agencies that broke the law by spending tens of millions of emalangeni on vehicles and transport running costs without authority

The report covered the financial year to 31 March 2017.

Muziwandile Dlamini said, ‘Bank balances were misstated by E7,528,772,278.72 due to non-reconciliation between the government cash books and bank statements. Some bank balances were overstated by E2,285,935,191.93 and other bank account balances were understated by E5,242,837,086.79 thus reflecting an incorrect cash flow position of the Government of Swaziland at year end.’

The report detailed inconsistencies throughout government, including:

DEPUTY PRIME MINISTER OFFICE

Disability payments went to people who did not qualify and those who were entitled were not getting them because the DPM’s Office had not developed guidelines on how to distribute grants. During the three years 2014 to 2016 disability grants amounting to E12.4 million were disbursed in the absence of guidelines which should have been created in line with the National Disability Policy of 2013. Eligibility assessment and screening of disabled citizens was conducted by social workers. The Auditor General’s report identified non-deserving people from across Swaziland who received a total of at least E228,720 without proper approval.

MINISTRY OF EDUCATION AND TRAINING

More than E3 million was unaccounted for by the Ministry of Education and Training. The report stated that the money was part of E23 million allocated to the ministry for rehabilitation of schools that were damaged by storms. Only E20 million was used for the project, an under-expenditure of 13 percent. Under expenditures, according to the report, were as serious as over-expenditures because if funds were not used, development would be retarded and economic growth negatively affected.

The Ministry also underspent on a project to supply water to schools. E2 million was approved and released but expenditure only amounted to E247,000, an under-expenditure of 88 percent.

MINISTRY OF HOME AFFAIRS

Government had lost E1.04 million paying salaries for four immigration officers who had been suspended from work, three of them on full pay since June 2014. No information was forthcoming about their cases and whether criminal proceedings had taken place against them. In another case the salary of an officer had been paid for three months after his death.

MINISTRY OF NATURAL RESOURCES AND ENERGY

A conveyancer defrauded the ministry of E3.29 million by submitting false information relating to the transfer of legal titles on two properties in 2014. The two properties were valued at E34 million and E21 million but the Registrar of Deeds was told they were valued at E2 million and E1 million. The conveyancer who was not named in the report should have paid transfer duty of E3.29 million but only E20,000 has been recovered. The Auditor General could not find transfer duty certificates when auditing the revenue collections by the Deeds Registry.

STRATEGIC OIL RESERVE FUND: An amount of E35.82 million was transferred from the Strategic Oil Reserve Fund without following proper procedures. The money was transferred on 25 August 2016 and based on a 3 percent interest rate it had earned an interest amounting to E1,077,571 by six months later. The Auditor General was not given any evidence supporting or explaining the transfer of the funds even though the public accounts committee (PAC) had ordered that the Ministry of Natural Resources and Energy should provide documentation that the withdrawal and transfer was done with the permission of the Ministry of Finance. The Auditor General concluded the money was taken illegally.

MINISTRY FOR TINKHUNDLA ADMINISTRATION AND DEVELOPMENT

Water project material amounting to E432,033 had gone missing at Mangcongco Inkhundla. The auditors discovered that water project materials amounting to E221,033 had remained unused for seven years. The material was kept at an Umbutfo Swaziland Defence Force (USDF) camp situated in Mangcongco. This, according to the auditors, indicated that bills of quantities were not used at every stage of the water project to give appropriate quantities and to correctly define the extent of work based on drawings and specifications of the project. The bills of quantities, according to the report, should have been prepared by an expert such as a water engineer.

According to delivery notes, the material was acknowledged to have been delivered. Therefore, the material could have been stolen after delivery. The report expressed a concern on the weak controls which existed within the ministry, whereby funds were released without ensuring that technical experts were involved when the material was quantified and released. The ministry also displayed a care-free attitude by not designing a follow-up mechanism of the project to ensure that the project was executed and completed properly. The ministry was negligent in taking care of scarce public funds.

EMPOWERMENT FUND: An amount of E3.67 million for the Empowerment Fund was used by the Ministry for Tinkhundla Administration and Development without rules and regulations or any documented control. The report concluded there was a risk that the fund could be used for purposes not intended.

Swaziland’s lack of financial prudence has been noted internationally. Each year the United States reviews governments that receive its assistance help ensure US taxpayer money is used appropriately and to provide opportunities to dialogue with governments on the importance of fiscal transparency.

The Fiscal Transparency Report on Swaziland for 2017 stated, ‘During the review period, budget documents were available to the general public, including online. While budget documents provided a general picture of government revenues and expenditures, revenues from natural resources and land leases were not included in the budget.

‘Expenditures to support the royal family were included in the budget but lacked specific detail and were not subject to the same oversight as the rest of the budget. Information in the budget was considered generally reliable, and the supreme audit institution’s reports of the government’s annual financial statements were published within a reasonable period of time, but some budget items were not subject to audit.

‘The criteria and procedures for awarding natural resource extraction licenses and contracts were outlined in law, but the opacity of the procedures, which involve submitting applications for licenses directly to the king, cast doubt on whether the government actually followed the law in practice. Basic information on natural resource extraction awards was not always publicly available.

‘Swaziland’s fiscal transparency would be improved by: providing more detail on expenditures and revenues in the budget, particularly for off-budget accounts, natural resource revenues, and royal family expenditures; subjecting the entire budget to audit and oversight; demonstrating applicable laws are followed in practice for awarding natural resource extraction contracts and licenses; and making basic information on natural resource extraction awards publicly available.’

Tuesday, 20 March 2018

FRAUD AT SWAZI DEPUTY PM’s OFFICE

The Deputy Prime Minister’s Office in Swaziland is in a financial mess; money is given to those who do not deserve it and withheld from those who do, overtime payments have been made fraudulently and rents not collected.

This is contained in the annual report of the Auditor General.

The DPM Office oversees the kingdom’s national policy that supports effect delivery of Government services, ‘through a well-coordinated decentralized system with a special emphasis on a comprehensive social welfare system, gender mainstreaming, children issues as well as proactive disaster preparedness’, according to the report.

Disability grants

The report which covers the year ending March 2017 stated there are no working guidelines on how to award disability grants yet the DPM’s Office gave out of E12.46 million (about US$1 million) to the three years ending March 2016.

The Auditor General reported Section 4.3 (iv) of the National Disability Policy of 2013 required Government to develop guidelines on how people with disabilities, who live below the poverty line, will access funds in various development schemes, including the assessment criteria to qualify for support from the grant. ‘Presently, eligibility assessment and screening of disabled citizens are conducted by Social Workers,’ the report stated.

The Auditor General reported, ‘However, without guidelines, deserving disabled people may be omitted from the list of beneficiaries whilst undeserving beneficiaries may receive disability grants.’

It added, ‘Guidelines should include an independent assessment of the disabled citizens’ health condition, by a competent medical specialist, so that only eligible persons benefit from the grant.’

The Auditor General reported E228,720 was paid to non-deserving beneficiaries without the approval of Social Workers.

There are also weak internal controls in the management of Welfare Grants. ‘The payment system was able to accept beneficiaries straight from the communities without involving Social Welfare Officers, yet the regulations require that Social Welfare Officers should authorise eligible beneficiaries,’ the report stated.

Audit of Payroll

The Auditor General found a number of irregularities with salary payments. An amount of E16,507.71 was wrongfully paid as overtime allowances to two ‘undeserving’ accounting officers who allegedly performed overtime duties at the Trade Fair in 2014. ‘The original request did not bear the names of the two accounting officers whilst the one attached to their payments had their names fraudulently inserted,’ the report stated. Names were also ‘fraudulently inserted’ in a list of payments ‘which had the endorsement of the Principal Secretary’.

The report also stated, ‘The supervisors of the Trade Fair duties, at the Deputy Prime Minister’s Office, were unaware about duties that would have required accounting officers to work overtime during the course of the Trade Fair in 2014.’

The Auditor General stated, ‘I am concerned that Government’s control measures were intentionally flouted.’

Rent deduction and housing allowance

It seemed some officers who lived in Government houses did not pay rent which by regulation should be deducted from salaries. Some who lived in private accommodation did not receive due allowances. This affected people in a number of grades, including social welfare officer, messenger, maid and labourer.

The Auditor General stated, ‘I raised my concern to the Controlling Officer that rentals due to government for the housing benefit may not have been collected, thus subjecting Government to a loss and furthermore, that Government may have been deprived of tax revenue in respect of the housing benefit, in cases where the officers were housed by Government.’

Massive financial mismanagement

The financial mismanagement at the DPM’s Office are not unique. The Auditor General reported the Swaziland Government’s bank accounts had been miscalculated by more than E7.5 billion (US$632.1 million).

The Auditor general reported ‘bank balances were misstated by E7,528,772,278.72 due to non-reconciliation between the government cash books and bank statements. Some bank balances were overstated by E2,285,935,191.93 and other bank account balances were understated by E5,242,837,086.79 thus reflecting an incorrect cash flow position of the Government of Swaziland at year end.’

A string of government departments and agencies have broken the law by spending tens of millions of emalangeni on vehicles and transport running costs without authority.

The Auditor General’s report shows the Prime Minister’s Office overspent its budget by E2.3 million (or 261 percent); the National Commissioner of Police overspent by E74.5 million (149 percent), Correctional Services E19.6 million (199 percent), Defence E26.4 million (46 percent).

The Auditor General stated, ‘Over expenditures beyond the budget provision and beyond amounts that have been appropriated by Parliament are illegal and clearly violate the Appropriation Act as well as Financial and Accounting instruction 0202 (ii).’

Wednesday, 14 March 2018

GOVT MINISTRIES BROKE LAW ON SPENDING

The offices of the Prime Minister, National Commissioner of Police, Defence Department and Correctional Services in Swaziland are among a string of government departments and agencies that have broken the law by spending tens of millions of emalangeni on vehicles and transport running costs without authority.

An Auditor General’s report has uncovered widespread malpractice that includes fraud and corruption.

The report shows the Prime Minister’s Office overspent its budget by E2.3 million (or 261 percent); the National Commissioner of Police overspent by E74.5 million (149 percent), Correctional Services E19.6 million (199 percent) and Defence E26.4 million (46 percent).

Other big over-spenders were Home Affairs (264 percent), Health (178 percent) and the Strategic Oil Reserve Fund (120 percent).

Muziwandile Dlamini, Acting Auditor General in the annual report for year ending 31 March 2017, said, ‘Over expenditures beyond the budget provision and beyond amounts that have been appropriated by Parliament are illegal and clearly violate the Appropriation Act as well as Financial and Accounting instruction 0202 (ii).’

At the core of the problem is the Central Transport Administration (CTA) whose main functions are to purchase, maintain and dispose of government vehicles and other related equipment as well as to provide fuel for government vehicles. It also provides vehicles on short-term hire to government ministries and departments.

The Auditor General’s report said there was poor record keeping and rules and regulations were often ignored. ‘As a result, risks such as theft of fuel and vehicle maintenance parts, overspending on the budget, funding of authorized expenditure and fictitious transactions were increased,’ the report stated.

The report highlighted a number of cases of malpractice. In the Ministry of Tourism and Environmental Affairs two vehicles had been taken out of service in January 2016. The report stated, ‘However, both vehicles mysteriously continued to incur charges [for fuel and maintenance] up to 1 September 2016. I further notified the Controlling Officer that the charges were monthly and were of the same amount each month.’ The costs totalled E46,268.

The report added, ‘I am therefore, very concerned that as it stands, I am not convinced that the costs incurred were justified and hence cannot rule out that the costs incurred were for stolen fuel and vehicle maintenance parts, unauthorized vehicles, abused vehicles or fictitious transactions. The Controlling Officer neglected his duty to ensure regular reconciliation of vehicle records with CTA charges in order to identify and correct anomalies promptly.’

At the Ministry of Defence it was discovered that one Isuzu vehicle was refuelled with 600 litres at a single fill although its tank had a maximum capacity of 70 litres.

In an audit of the CTA Trading Account the Auditor General found E528 million had been spent in 2016-2017 without an approved budget. ‘The Central Transport Administration has been incurring expenditure through requests made by the Ministry of Public Works and Transport to the Ministry of Finance, which then releases funds without issuing Warrants.

‘The budget to operate the trading account was also not sanctioned by Parliament, through an appropriation Act, and it was also not included in the budget of the Ministry of Public Works and Transport, making it difficult to hold the CTA management accountable for a budget that they do not control. This may result in Government spending more money on items that are not Government priority.’

The Auditor General stated, ‘There was no way the CTA could be evaluated, in terms of financial performance, to determine whether the CTA provides returns on Government’s investment, from its trading activities or whether it is becoming a financial drain on public funds.’

During the audit it was discovered that a total of 1.75 million litres of fuel, valued at E19.53 million were not accounted for by CTA. The Auditor General reported, ‘I am concerned that by its nature, fuel is an attractive item of stores which may be subject to abuse or theft if not properly accounted for and controlled.’

The CTA has been riddled with corruption for years. In 2013 former General Transport Manager Polycarp Dlamini was sentenced to seven years in jail for his role in defrauding the department around E11 million.

In December 2012, Ntuthuko Dlamini, Minister of Public Works and Transport, told parliament that close to E3 billion of taxpayers’ money went into investigating corruption at the CTA dating back to the 1990s. The Times of Swaziland reported, ‘He said ever since the problems of corruption surfaced at CTA, many specialists were hired over the years to do forensic audits, but, unfortunately, crucial recommendations were never implemented.’

In August 2013 when CTA was reported to be running a deficit of E400 million Dlamini announced it would be converted into a parastatal like the Swaziland Posts and Telecommunications Corporation (SPTC) and Swaziland Electricity Company (SEC). It would be led by a Chief Executive Officer and also have a Chief Financial Officer.

The Times reported, ‘Such a transformation is envisaged to bring about sweeping changes expected to eliminate the many misdeeds that went on at the CTA, including the disciplinary of wayward staff.’

The parastatal was to be called Central Transport Organisation. An Act of Parliament was gazetted in 2013 to allow this to happen, but to date the change has not gone through.

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