AG raises major red flags in the Gauteng Health Department

The Gauteng Department of Health has been flagged by the Auditor General of South Africa as the only department with non-compliance across all areas, due to a “lack of effective internal control.”

This is according to Lebogang Maile, Gauteng Treasury MEC, who briefed the media regarding the latest reports from the Auditor General of South Africa (AGSA).

The Department of Health received an unqualified audit opinion with findings, indicating that the financial statements contain no misstatements.

However, the findings indicate issues regarding reporting, not reaching predetermined goals, or non-compliance with legislation. 

Maile said that these findings were related to noncompliance with regulations on expenditure and supply chain management.

This is responsible for an uptick in irregular expenditure, according to the MEC. He added that consequence management remains a problem. 

“Accounting officers did not implement recommendations from completed investigations,” said Maile. 

“This indicates weak internal controls and a lack of adequate management reviews in the financial reporting process.”

Last year’s Auditor General report on the Health Department critiqued the department for underspending its budget by R1.1 billion. 

This included a National Treasury Service Grant intended for specialised medical equipment, which was not purchased.

The department racked up R2.7 billion in irregular spending in the previous year, a R400 million increase from the 2023/2024 financial year, and R17 million in wasteful expenditure. 

Despite this, the budget for the department was increased from R64.8 billion in the 2024/2025 financial year to R67 billion for the 2025/2026 financial year.

While the latest figures for the 2024/2025 financial year haven’t been made public yet, it is clear from the MEC’s comments that the department has not improved its financials.

‘The challenges are huge’

“There are a lot of challenges in the department of health and we have, on several occasions, been the first to admit that,” he said. 

Maile added that the audit outcome for the department has not regressed to a qualified audit, which shows that work is being done to address the department’s financial issues. 

“It’s not like nothing is happening, something is happening, and maybe not as fast as we could, but the challenges are huge,” he said. 

“The health system is huge. We service 1.2 million people every month. So it’s not a small matter.”

Maile added that the department is looking to the private health sector to see how it can resolve its issues. 

The Gauteng Treasury has further plans to hold a workshop with the Department of Health to better understand the problems the department is facing and see how this can be addressed.

The MEC is confident that the department’s audit will improve in the next financial year.

According to a written reply to the Democratic Alliance (DA) in Gauteng, the total amount of accruals for the department at the end of the 2024/2025 financial year was just over R8 billion. 

The department will have to settle this debt in the current financial year, spending 12% of this year’s budget on repayments. 

“Such colossal mismanagement should lead to the dismissal of Gauteng Health MEC Nomantu Nkomo-Ralehoko and head of department Lesiba Malotana,” the DA said. 

The Department of Health currently does not have a Chief Financial Officer, and the Gauteng Finance Portfolio Committee is concerned about a decline in on-time payments.

There has been a decline in on-time payments between the fourth quarter of the 2024/2025 financial year and the first quarter of the 2025/2026 financial year.

Only 38% of the department’s invoices are paid within 30 days. 

The DA said that the Health MEC and Head of Department are presiding over a failing department, plagued by scandals and financial mismanagement.