Govt in red by N$356,3m

GOVERNMENT overspent its budget by a staggering N$356,4 million in the 2004-2005 financial year – about N$260 million more than the previous year.

Finance Minister Saara Kuugongelwa-Amadhila yesterday tabled the audit report of Government expenditure for 20054-05 in the National Assembly, just before announcing that she would introduce an additional budget today. Lack of financial control and sloppiness in collecting subsistence and travel advances are the major criticisms in the latest audit.”This increase of unauthorised expenditure is of great concern and Government should strive to improve on existing controls to reduce the level of over-expenditure,” Auditor General Junias Kandjeke recommended.According to the 11 ministries concerned and the Electoral Commission, the main reasons for overspending were unexpected cost increases, insufficient budgetary provision, late processing of orders from the Government Garage, constant increases in fuel prices, the non-existence of an additional budget and the system to collect subsistence and travel allowances, “which was not functioning at the end of the fiscal year”, the Auditor General said.The Ministry of Basic Education, as it was still called in the year under review, topped the list with an over-expenditure of N$167,4 million, followed by the Police Department (N$53,9 million), the Health Ministry (N$50,4 million) and the Electoral Commission (N$31,7 million), which overspent its budget by 58,5 per cent.Unauthorised defence spending came to N$18,9 million.The Ministry of Environment and Tourism overspent by N$12,3 million and the Civic Affairs Department in the Home Affairs Ministry registered unauthorised expenditure of N$10,1 million.The office of former President Sam Nujoma exceeded its budget by N$3,6 million.”Exceeding the approved budget limits represents a disregard of the National Assembly’s powers to control and authorise the use of taxpayers’ money for approved activities and up to unspecified limits,” the Office of the Auditor General emphasised.At 18 ministries it was found that long-outstanding subsistence advances amounted to a combined N$20,8 million, up from N$18,2 million the previous year.This was mainly due to the reluctance of staff to submit claim forms for their advances.The audit report said that ministries had to obtain approval before opening accounts at commercial banks, but several ministries ignored this and kept such bank accounts and failed to keep proper records of these accounts.The culprits included the Ministries of Foreign Affairs, Health, Labour, Trade, Lands, Information and Broadcasting as well as the National Planning Commission and the Ministry of Regional and Local Government and Housing.Accumulated domestic and foreign Government debt came to N$11,8 billion, an increase of 20,3 per cent for the financial year ending March 31 2005.”This steady increase of Government debt over the past financial years is of grave concern,” Kandjeke said.During the same period, 45,8 per cent of total Government expenditure was financed through borrowing, slightly less than the year before when 47 per cent had to be borrowed.Interest paid on foreign loans came to N$69 million and N$928,1 million had to be coughed up for domestic loans.The audit report further revealed that the Government had guaranteed N$1,09 billion worth of loans for parastatals, but that “no proper record system existed in the Finance Ministry to ensure that all guarantees administered by the Treasury were reported”.”The auditors could therefore not certify that all guarantees were verified,” the Auditor General stated.Lack of financial control and sloppiness in collecting subsistence and travel advances are the major criticisms in the latest audit.”This increase of unauthorised expenditure is of great concern and Government should strive to improve on existing controls to reduce the level of over-expenditure,” Auditor General Junias Kandjeke recommended.According to the 11 ministries concerned and the Electoral Commission, the main reasons for overspending were unexpected cost increases, insufficient budgetary provision, late processing of orders from the Government Garage, constant increases in fuel prices, the non-existence of an additional budget and the system to collect subsistence and travel allowances, “which was not functioning at the end of the fiscal year”, the Auditor General said.The Ministry of Basic Education, as it was still called in the year under review, topped the list with an over-expenditure of N$167,4 million, followed by the Police Department (N$53,9 million), the Health Ministry (N$50,4 million) and the Electoral Commission (N$31,7 million), which overspent its budget by 58,5 per cent.Unauthorised defence spending came to N$18,9 million.The Ministry of Environment and Tourism overspent by N$12,3 million and the Civic Affairs Department in the Home Affairs Ministry registered unauthorised expenditure of N$10,1 million.The office of former President Sam Nujoma exceeded its budget by N$3,6 million.”Exceeding the approved budget limits represents a disregard of the National Assembly’s powers to control and authorise the use of taxpayers’ money for approved activities and up to unspecified limits,” the Office of the Auditor General emphasised.At 18 ministries it was found that long-outstanding subsistence advances amounted to a combined N$20,8 million, up from N$18,2 million the previous year.This was mainly due to the reluctance of staff to submit claim forms for their advances.The audit report said that ministries had to obtain approval before opening accounts at commercial banks, but several ministries ignored this and kept such bank accounts and failed to keep proper records of these accounts.The culprits included the Ministries of Foreign Affairs, Health, Labour, Trade, Lands, Information and Broadcasting as well as the National Planning Commission and the Ministry of Regional and Local Government and Housing.Accumulated domestic and foreign Government debt came to N$11,8 billion, an increase of 20,3 per cent for the financial year ending March 31 2005.”This steady increase of Government debt over the past financial years is of grave concern,” Kandjeke said.During the same period, 45,8 per cent of total Government expenditure was financed through borrowing, slightly less than the year before when 47 per cent had to be borrowed.Interest paid on foreign loans came to N$69 million and N$928,1 million had to be coughed up for domestic loans.The audit report further revealed that the Government had guaranteed N$1,09 billion worth of loans for parastatals, but that “no proper record system existed in the Finance Ministry to ensure that all guarantees administered by the Treasury were reported”.”The auditors could therefore not certify that all guarantees were verified,” the Auditor General stated.