Almost R1 billion lost to known government fraud in South Africa

3d man tied with text 'fraud' after committing crime.The Times reports that nearly R1-billion lost through fraud in the public service has not been recovered.

Government departments have managed to get less than R1-million back into the state’s coffers.

The Public Service Commission has found that the public service lost R932.3-million to financial misconduct in the 2010-2011 financial year.

According to the commission, misconduct relates to theft, mismanagement, misappropriation and abuse of funds, fraud, corruption and gross negligence.

North West – where fighting between rival factions in the ruling ANC is rife – was the worst offender.

Financial misconduct by public servants cost the province R673821980.45, but the authorities managed to recover only R4530.

Limpopo, which had several departments placed under administration by the cabinet, performed much better than North West.

Financial misconduct cost it R16123114.64 – but only a measly R1367.37 was recovered.

Figures for the 2011-2012 financial year show that the cost of financial misconduct has dropped dramatically to R230-million but cases monitored by the commission rose to 1243 – up from 1035 the year before.

In 2011-2012, departments in Gauteng misused R14-million of public money.

Only R27000 has been recouped to date.

Gauteng flushed away R18463258 and recovered a mere R4259.

Public Service Commission member Mike Seloane said the drop can be attributed to two factors.

“The systems are becoming effective or departments are simply not declaring financial misconduct. There are departments that have declared no financial misconduct,” he said.

The commission will launch an inquiry into the reasons for the low rate of recovery of misused public money.

In addition to financial misappropriation, the commission observed that efforts to deal with the problem were being frustrated by political heads of department.

It expressed displeasure at the “reluctance by departments to disclose fully the financial misconduct cases”.

And it noted that there were “no concrete plans to ensure that money lost to the state was recovered fully”.

The report detailing the latest national financial misconduct figures is expected to be published and presented in parliament in August or September.