Pandemic fuels N$1.1bn ‘unauthorised spending’
Hundreds of millions of Namibian dollars - which government had to pump into especially the country’s health and education systems to mitigate the unforeseen impact of Covid-19 - resulted in unauthorised overspending of about N$1.1 billion in the 2020/21 budget year.
This unauthorised expenditure was the basis of Auditor-General (AG) Junias Kandjeke’s qualified opinion of government’s accounts for the year ended 13 March 2021. The qualified report means the AG disagreed with government regarding the application, acceptability or adequacy of its accounting policies. Overspending – a contravention of the State Finance Act – relates to any expenditure that exceeds the amount appropriated for a vote, main division or subdivision in the national budget.
The AG is required by law to mention every unauthorised expenditure in a given fiscal year. Government’s total unauthorised expenditure in 2020/21 was nearly 60% - or N$657.7 million - higher than in 2019/20.
Budget breakdown
According to the AG’s latest report on government accounts, the education ministry overspent its authorised budget by about N$623.3 million in 2020/21. Health’s overspending was nearly N$366.6 million.
When finance minister Iipumbu Shiimi tabled his 2020/21 main budget on 27 May 2020, he allocated nearly N$14.19 billion to education, arts and culture. In his mid-term revised budget later that year, the budget was increased to around N$14.5 billion. The ministry ended up spending about N$15.14 billion.
Health and social services got about N$7.95 billion in the 2020/21 main budget, which was increased to around N$8.05 billion in the revised budget. The ministry's final expenditure was about N$8.4 billion, or 4.55% more.
The AG’s report doesn’t provide details on how the extra money was spent. However, in his main budget speech last year, Shiimi gave an indication of the scope of spending Namibia’s first pandemic year required. Boosting the capacity of the country’s health system in 2020/21 cost nearly N$723 million, while around N$468 million was needed to expand, renovate and upgrade school and hostel facilities.
Other culprits
In addition to health and education, the AG said the following votes overspent their budgets in 2020/21: Office of the President by about N$1 million (or 0.2%); the ministry of international relations and cooperation (N$16.7 million or 1.72%); mines and energy (N$5 319); sport, youth and national service (N$1.98 million or 0.74%); and public enterprises (N$92 million or 11.37%).
Only about N$809 million was supposed to be spent on public enterprises, but they gobbled up nearly N$901 million in 2020/21. Government’s total remuneration bill also came in about N$933 million higher than the authorised nearly N$28.7 billion in 2020/21.
The AG recommended that an “up-to-date commitment register” be kept to assist government’s accounting officers to “eliminate excesses by requesting approvals for virements timeously”. Properly trained accountants and improved communication will also improve the situation, Kandjeke said.
The finance ministry’s accounting officer responded in the report that it will implement the AG’s recommendation by “actively monitoring expenditure” and engaging the affected votes.
This unauthorised expenditure was the basis of Auditor-General (AG) Junias Kandjeke’s qualified opinion of government’s accounts for the year ended 13 March 2021. The qualified report means the AG disagreed with government regarding the application, acceptability or adequacy of its accounting policies. Overspending – a contravention of the State Finance Act – relates to any expenditure that exceeds the amount appropriated for a vote, main division or subdivision in the national budget.
The AG is required by law to mention every unauthorised expenditure in a given fiscal year. Government’s total unauthorised expenditure in 2020/21 was nearly 60% - or N$657.7 million - higher than in 2019/20.
Budget breakdown
According to the AG’s latest report on government accounts, the education ministry overspent its authorised budget by about N$623.3 million in 2020/21. Health’s overspending was nearly N$366.6 million.
When finance minister Iipumbu Shiimi tabled his 2020/21 main budget on 27 May 2020, he allocated nearly N$14.19 billion to education, arts and culture. In his mid-term revised budget later that year, the budget was increased to around N$14.5 billion. The ministry ended up spending about N$15.14 billion.
Health and social services got about N$7.95 billion in the 2020/21 main budget, which was increased to around N$8.05 billion in the revised budget. The ministry's final expenditure was about N$8.4 billion, or 4.55% more.
The AG’s report doesn’t provide details on how the extra money was spent. However, in his main budget speech last year, Shiimi gave an indication of the scope of spending Namibia’s first pandemic year required. Boosting the capacity of the country’s health system in 2020/21 cost nearly N$723 million, while around N$468 million was needed to expand, renovate and upgrade school and hostel facilities.
Other culprits
In addition to health and education, the AG said the following votes overspent their budgets in 2020/21: Office of the President by about N$1 million (or 0.2%); the ministry of international relations and cooperation (N$16.7 million or 1.72%); mines and energy (N$5 319); sport, youth and national service (N$1.98 million or 0.74%); and public enterprises (N$92 million or 11.37%).
Only about N$809 million was supposed to be spent on public enterprises, but they gobbled up nearly N$901 million in 2020/21. Government’s total remuneration bill also came in about N$933 million higher than the authorised nearly N$28.7 billion in 2020/21.
The AG recommended that an “up-to-date commitment register” be kept to assist government’s accounting officers to “eliminate excesses by requesting approvals for virements timeously”. Properly trained accountants and improved communication will also improve the situation, Kandjeke said.
The finance ministry’s accounting officer responded in the report that it will implement the AG’s recommendation by “actively monitoring expenditure” and engaging the affected votes.
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