The City of Cape Town was red-flagged by Auditor-General Kimi Makwetu for irregular spending to the tune of R65 million.
According to Local Government MEC Anton Bredell, the City failed to comply with the requirements on municipal supply chain management (SCM) regulations from the auditor-general which resulted in the City recording a higher amount in irregular expenditure for the most recent financial year.
In response to a question in the legislature from MPL Derrick America about the irregular spending, Bredell said the City had procured legal services for several years through a process that had now been found to be non-compliant with all the SCM Regulations.
“The City was, therefore, requested to disclose such legal services procured as irregular expenditure retrospectively for five financial years,” said Bredell.
“In addition, due to the City’s interpretation of the legislation with regards to the disclosure of irregular expenditure relating to amounts paid versus payable, the practice in the City was to disclose amounts paid as irregular expenditure and the amount payable as a deviation,” said Bredell.
“It was found that both amounts should have been disclosed as irregular expenditure and the City had to re-classify the amounts payable from deviations to irregular expenditure. This resulted in a decrease in the deviation and an increase in the irregular expenditure amounts being disclosed.”
Bredell said the City is already taking corrective measures to prevent any reoccurrence in the future.