‘Mantšali Phakoana
The parliamentary Public Account Committee (PAC) has expressed concern over persistent failure by government ministries to reconcile bank accounts and cash books after spending public funds entrusted to them.
The committee says it is also worried by the ministries’ violation of the Public Financial Management and Accountability Act, 2011, citing this has opened a hole for civil servants to steal public funds with the belief that they will not be traced.
The PAC raised these concerns this week during a meeting with the ministry of finance and development planning. The Committee had invited the ministry to respond to queries raised by the Auditor General’s reports covering the financial year ending March 31, 2017 to March 31, 2021.
PAC member, Montoeli Masoetsa said they were riled by failure by various ministries to reconcile their books over the years.
Masoetsa strongly condemned the ministries for failing to account for the public funds entrusted to them, adding that it was high time for legal officers in each ministry to take action against perpetrators.
“Theft, fraud and abuse in government costs the taxpayers billions,” he said.
The situation breeds general contempt and loss of confidence in government and could bankrupt the economy if left unchecked, he warned.
For his part, another PAC member, Lephoi Makara revealed that Lesotho does not have an effective financial system.
Makara explained that the current government’s financial system, Integrated Financial Management and Information System (IFMIS), is not effective hence the common challenges of lack of accountability in public funds.
“You will agree with this committee that currently, Lesotho does not have a clear financial system, and without that, we can never have a clean audit report.
“Also, the report issued by the ministry of finance last year that there was a missing M6.1 billion left Basotho with doubts. This kind of acts are a result of our ineffective financial system,” he pointed out.
Finance and development minister, Retšelisitsoe Matlanyane in April this year said the government had managed to trace at least M3.5billion of the M6.1 billion reported as unaccounted for in a July 2022 audit report by former acting auditor-general, Monica Besetsa.
The audit report covered the 2021/22 fiscal period.
Speaking at a dialogue to review Prime Minister Sam Matekane government’s first 100 days in office, Matlanyane said the M6.1 billion had accumulated over many years because previous governments ignored audit queries.
“Of that M6.1billion, which was reported missing, we found that it was cumulative. It had been reported in previous audit reports, but government ignored it. When we were doing some reconciliations, we could only find how M3.5billion of that money was used and there is proof to that,” she told the review session.
She added that the money was withdrawn from the different government bank accounts but was not recorded within the government’s books.
Makara requested the ministry of finance and development planning to provide the committee with the contract between IFMIs system and the government and its terms of reference.
He also accused the ministry of lack of transparency when accounting and presenting public funds reports.
Appearing before the PAC, Accountant General ‘Malehlohonolo Mahase said the ministry has embarked on a roadmap to clean audits following irregularities encountered in its various audit reports.
Mahase noted that some of the challenges that lead to irregularities in the auditor general’s report were delays by line ministries to submit end of year financial statements to the ministry of finance.
However, she said in a bid to curb such challenges, they have asked ministries to submit their monthly financial reports in time to raise any issues and address them before being audited.
She added that there was also lack of ownership from chief accounting officers in the line ministries.
“Starting from this year, chief accounting officers have started to submit their monthly financial reports to the ministry in an open platform,” Mahase explained.
There was backlog of supplementary budget between 2009-2019 due to a variety of reasons and the ministry is now things doing things differently to ensure more effective financial reporting, she said.
Mahase indicated that the ministry had also encountered a challenge of late and non-reconciliation of government bank accounts.
In most incidents, she said there was variation in the amounts of money in the cash book and bank account.
“We are working with the reconciliation department on monthly reports to ensure cash book and bank balances are the same.
“Coming to the budget reconciliation and execution, we realised that when we reconcile funds spent by line ministries, our appropriation and supplementary budgets were not corresponding.
“Also, the budget (capital, revenue and capital expenditure) allocated to some ministries were not corresponding with what we have allocated, while in some instants ministries report what is different from what we have given them,” she added.
The PAC is a sessional Committee of the Parliament of Lesotho which was established under Standing Order No.97 (5). Its mandate is to consider the financial statements and accounts of all government ministries and departments, executive organs of state, courts, authorities and commissions established by the Constitution and of each one of the two Houses of Parliament. It also looks into audit reports issued on financial statements, accounts or reports referred to the Committee by the House, the Speaker or Standing Orders.
