Factors hindering public financial management and accountability in South Africa

Abstract

Service delivery, poverty reduction and economic development and sustainability depend on the availability of money and the ability to use it effectively, which requires good financial management. Financial management fulfils an important role in the public sector, because without public funds to cover operational and capital costs, and without appropriate personnel, no public institution can render effective services. This paper analyses factors that affect the effectiveness of public financial management in South Africa. Many factors hinder public financial management and accountability, including the high turnover rate of accounting officers and of parliamentary committees such as the Standing Committee on Public Accounts (SCOPA), and a lack of political will. Although South Africa has suitable oversight bodies, policies, procedures and Acts, the poor state of financial management in South African government departments is demonstrated by the low number of clean qualified audits which show that the requirements of the Public Finance Management Act, Act 1 of 1999, the legislative oversight bodies, and the wider legal framework governing public finances have been flouted. If financial management in the public service is not addressed holistically, it may hamper, rather than assist, government departments in their service delivery programmes.