The Presidential Employment Programme (PEP) in eThekwini Municipality has been flagged for irregularities after it emerged that more than half-a-million rand has been paid to people who were not supposed to benefit from the programme.
People working in other government departments and dead people have been beneficiaries of the programme.
The PEP is a government initiative that intends to stimulate economic activity by giving employment to South Africans without work.
A report compiled by the municipality’s economic development and planning cluster (which has oversight of the programme) detailed the irregularities. It was compiled after the auditor-general found during its audit that there were material irregularities in the programme.
The AG’s audit covered the 2022/23 financial year and was tabled before the municipal public accounts committee (Mpac) last week.
The report revealed that R471 000 had been paid irregularly to people who should not have been part of the programme as they were already employed elsewhere in government at the time they benefited.
Twelve of the people were employed in other government departments, while eight were deceased. One person was paid R147 000 from the programme while he was in the employ of the Department of Public Works.
Two other people earned R73 000 from the programme while they also worked for the state. It found that more than R42 000 was paid posthumously to eight people who were deceased.
A report on the matter said initially there were 196 people who had been flagged by the audit, but the bulk of these had been cleared. The majority were members of the ward committee who received a stipend which did not constitute official remuneration.
“During the audit period of 2022/23, the auditor-general’s office identified 196 beneficiaries registered on the PEP database who appeared ”as in the employ of the state“. These beneficiaries were said to be in the employ of various government departments, including the eThekwini Municipality.
“The identified beneficiaries from eThekwini Municipality were ward committee members receiving remuneration from the municipality. Upon engagement with City Hall administration, it was confirmed that these beneficiaries receive an ‘out of pocket’ reimbursement as compensation for ward committee-related work and is not in any way interpreted as compensation for work done,” said the report.
It said 78 of these beneficiaries were ward committee members and the matter was addressed with the assistance of the City Hall administration wherein the “out of pocket expense” paid is not a salary or stipend and therefore does not preclude these ward committee members from participation in public employment programmes
The report continued: “That 12 beneficiaries based on evidence are guilty of ‘double dipping’ and processes are under way in investigating and recovering funds.” It showed that this came at a cost of R471 000.
It said 14 deceased beneficiaries were paid posthumously, according to the auditor-general. “This was rebutted during the audit period and reduced from 14 to eight beneficiaries who erroneously received a salary with a financial loss of R42 664.09.
“The extent of financial loss in the 2022/23 financial year was, according to our submissions to the auditor-general, R471 327.16 for those said to be in the employ of other government departments and R42 664.09 for deceased beneficiaries erroneously paid,” it said.
ActionSA councillor Alan Beesley said the allegation of abuse of the programme was a serious concern.
“The abuses that have taken place in the Presidential Employment Programme highlight how poor the expenditure controls are within the municipality, the responsibility of which ultimately lies with the mayor and his leadership team,” he said.
DA councillor Sibonisi Sibisi said they have called on the City to do more to prevent double dipping where people who are already employed in other government departments are also benefiting from the PEP illegally.
Committee chairperson Thami Xuma said the report painted a picture of serious abuse of the programme. “What that report detailed was just pure fraud and corruption and the possible misuse of the programme for patronage purposes, similarly to the abuse of the Expanded Public Works Programme.”
He said they demanded clarity on the revelation that the money paid to members, if the ward committee is not counted as remuneration, is classified as “out of pocket”.
“We are still waiting for the CFO to come to the committee to explain how the R1 500 they pay to ward committee members is accounted for in their books.”
The Mercury