Cabinet cracks whip on non-compliance

Pretoria - Cabinet has announced that it will intervene in the financial
administration of three provinces in the country.

The move, which was taken after a special Cabinet meeting on Monday,
aims to address under-spending, overspending and challenges with supply
chain management.

The three provinces are Gauteng, Free State and Limpopo.

"The Minister of Finance was asked by Cabinet to urgently review the
situation in Limpopo and other provinces and report back to Cabinet on
proposed actions to be taken to improve the financial situation and its
impact on service delivery and provincial functions," Cabinet said in a
statement.

While National Treasury and other relevant national departments have
been engaging with various provincial departments over time to try to
improve financial management and service delivery, Cabinet said the
situation remained unsatisfactory.

Gauteng had requested National Treasury to help address their supply
chain management and financial controls in the Department of Health and
Social Development, which has been in the spotlight for not paying
service providers on time.

Cabinet said Gauteng Premier Nomvula Mokonyane has been made to sign an
agreement with the Ministers of Health and of Finance to solve the
province's financial mismanagement.

In addition, urgent action will be taken in respect of the Gauteng
Shared Services Centre (GSSC), which provides administrative services
for all the province's departments.

Mokonyane will later today brief the media on the matter.

The Free State will be assisted with the Police and Roads and Transport
Departments after poor financial management and non-compliance to supply
chain management processes were identified.

The biggest rescue is in Limpopo, where five departments -- Treasury,
Education, Transport and Roads, Health and Public Works -- will be taken
over by the national departments.

Cabinet said the province had dried up its R757 million overdraft
facility. The province had requested that its facility be increased by
R1 billion to R1.7 billion in order to pay salaries.

This was declined and instead they were given an advance from their
equitable share.

Cabinet said forensic investigations will be carried out in these
provinces, with strict timelines, and there will be consequences for any
illegal conduct uncovered.

A Monitoring Committee of seven ministers, led by Finance Minister
Pravin Gordhan, has been established to help monitor these three provinces.

"This committee will be empowered to co-opt any other ministry as it
deems appropriate," reads the statement.

Cabinet is also involved in the administration of the Eastern Cape
Education Department, which is facing financial management problems that
have crippled the schooling system. - BuaNews