Linda Ensor
17 January 2006
Cape Town — The North West agricultural department had collapsed due to fraud and corruption and was unlikely to spend more than 2% of its R140m budget this year, Parliament learnt yesterday.
Capacity problems continue to be a constraint on spending in most provinces, but none are as bad as the North West agricultural department, Parliament's select committee on finance heard yesterday.
The committee is holding a two-week hearing on the expenditure of conditional grants -- funding tied to specific projects -- by provincial and national treasury officials, as well as provincial MECs.
By end-December, just three months before the end of its fiscal year, the North West agricultural department spent only 1,2% of its conditional grant of R55m and only 0,8% of its R91m infrastructure grant.
"Little spending will take place for the rest of the year" as the department had no ability to do so, North West finance MEC Maureen Modiselle told the committee.
"Simply speaking, there is no agriculture department in North West. I cannot say the situation of conditional grants will improve. It will not."
The department lacked capacity in planning and project management and was unable to retain professionals, Modiselle said.
North West national treasury superintendent-general Phineas Tjie said the agricultural department was paralysed by the suspension and arrest of several key directors and chief directors on charges of fraud and corruption.
Ten senior staff were suspended last year, with some already arrested for the irregular disbursement of agricultural support funds.
In a separate matter, the head of the department had also been suspended, leaving the department with junior staff members who were afraid to do anything, Tjie said.
National treasury senior economist Chris Adams said overall spending by provinces had improved from before, though capital spending remained weak. In the period April 1 to November 30 provinces spent R136bn, or 62% of their total adjusted budget of R219,2bn.
However, capital expenditure was a "low" R6,6bn, or 47,2% of the adjusted capital budget of R13,9bn.
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