8th November 2024

MK Party to File Fraud Charges Against National Treasury

Enoch Godongwana, the South African Minister of Finance, delivers his mid-term budget policy statement in the Cape Town City Hall, which is being used as a venue for the South African Parliament, in Cape Town on November 1, 2023. Image: RODGER BOSCH / AFP

Ramaphosa is accused of concealing an SIU report into a R400 million IFMS tender irregularly awarded by the National Treasury.

The UMkhonto weSizwe (MK) Party has announced its intention to lay fraud and corruption charges against the National Treasury at the Brooklyn police station in Tshwane on Monday, 21 October. This action is centered around the allegedly irregularly awarded R400 million Integrated Financial Management System (IFMS) tender.

WHY DOES THE MK PARTY WANT TO OPEN A CASE AGAINST THE NATIONAL TREASURY?
Reports indicate that the Auditor-General flagged the IFMS project, which cost the National Treasury R400 million. This scrutiny originated from an investigation by the Special Investigating Unit (SIU), which purportedly found that the contract was irregularly awarded and cited non-compliance with legislation among various other issues.

In a related matter, the Economic Freedom Fighters (EFF) have confirmed that their leader, Julius Malema, has written to President Cyril Ramaphosa urging the release of the SIU report submitted to him in March 2024. The party stated that the irregularities highlighted by the SIU necessitate transparency and public awareness of the findings.

“Withholding this report undermines transparency, accountability, and the principles enshrined in our Constitution, which demands that the National Treasury responsibly manage public funds. The EFF views the failure to release the report as protection of corruption and a betrayal of public trust,” the Red Berets declared.

ENTITIES FAIL TO ACHIEVE A CLEAN AUDIT
In the meantime, ActionSA has stated that it will write to Dr. Mkhacani Maswanganyi, the chairperson of the Standing Committee on Finance, requesting the urgent summoning of the nearly 40% of National Treasury entities (six out of 16) that have failed to achieve clean audit reports to appear and account before the Committee.

The party expressed concern regarding the poor audit outcomes of entities reporting to the National Treasury. As the custodian of good governance, it is unacceptable for so many entities under its oversight to fail in achieving clean audits.

“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 such a significant entity cannot ensure proper financial management and accountability,” remarked ActionSA Member of Parliament Alan Beesly.

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

Beesly further stated that, beyond the poor audit outcomes, ActionSA is alarmed by the Auditor-General’s observation regarding the persistent failure of various entities to meet their performance targets. The National Treasury met only 79% of its targets, while the PIC achieved a mere 64% of its planned objectives.