‘It’s an expensive process’: Provinces grapple with high cost and resistance to lifestyle audits
· Citizen
The rollout of lifestyle audits across South Africa’s provincial governments is proving both costly and complex.
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This was revealed during a briefing to parliament’s portfolio committee on public service and administration on Wednesday, where premiers outlined progress and persistent obstacles in implementing the audits, which were made mandatory in April 2022 to combat corruption.
‘Costly’ lifestyle audits
Gauteng Premier Panyaza Lesufi underscored the programme’s financial burden but maintained that it remains non-negotiable.
“This exercise is costly, but it must be done.”
The Gauteng provincial government has taken steps to strengthen its approach by introducing independent oversight through an ethics advisory council that includes former public protector Thuli Madonsela.
Lesufi told MPs the council identified weaknesses in the current system, prompting the province to partner with the Special Investigating Unit (SIU).
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Audits have already been conducted on senior leadership, including MECs, directors-general and heads of government entities.
The province is now focusing on procurement-related roles, with nearly 3 600 supply chain management officials already audited.
Lesufi stressed that proper legal frameworks must be put in place to ensure audits can proceed without hindrance when investigations arise.
He added that the other state bodies, including the Financial Intelligence Centre (FIC), needed to be on board to strengthen the process.
Red flags, inconsistencies and gambling concerns
Gauteng director-general Edward Mosuwe outlined that officials are flagged as high-risk when red flags such as non-compliance, suspicious financial transactions, or adverse findings in their qualifications emerge.
He revealed that some lifestyle audits do not yield clear conclusions, particularly where individuals fail to disclose business interests or provide misleading information.
Discrepancies have also been identified in both criminal and disciplinary records.
“SIU says one thing, but the Saps records would say something else,” Mosuwe said.
READ MORE: Lifestyle audits reveal 24 public servants flagged for hidden wealth
Highlighting trends from the audits, Mosuwe pointed to a concerning pattern of excessive gambling among Gauteng government employees, especially those in junior supply chain management roles.
He also raised challenges related to limited internal capacity, explaining that the SIU “don’t come cheap”.
“Anytime they do a lifestyle audit, we also have to pay them.”
Watch the meeting below:
Tax implications
Additional concerns relate to the financial burden on officials undergoing audits.
According to Mosuwe, individuals are reportedly required to pay upfront to obtain historical bank statements, and reimbursement of these costs may trigger tax implications, as such repayments can be treated as additional income by the South African Revenue Service (Sars).
“Now, when they claim back what they would have paid out of their own pocket, and they claim back, Sars picks up that they have got an additional payment, and that has an implication on their pay as you earn. That’s what they allege,” he said.
These issues, Mosuwe said, will need further engagement with National Treasury and Sars to clarify the financial and tax consequences.
He added that data protection laws, particularly the Protection of Personal Information (Popi) Act, also affect how audits are conducted.
Northern Cape battles pushback from officials
In the Northern Cape, resistance from public servants is slowing progress.
Premier Zamani Saul said 590 officials (367 completed) have been audited, but compliance remains a challenge.
Around 40% – or 216 individuals – have not submitted the required information.
“It’s an expensive process for us to run these lifestyles,” Saul told MPs.
Meanwhile, Northern Cape director-general Justice Bekebeke revealed that the pushback from officials has become common.
“We have been receiving a number of lawyers’ letters to say that we are not going to be doing that,” Bekebeke said.
READ MORE: More lifestyle audits on their way, this time by the FIC
He added that reluctance to disclose personal and family financial information is widespread.
“If we thought this was a programme that was welcomed by the bulk of civil servants, our experience in the province is that it has not been.”
The province has turned to the state law advisor to enforce compliance.
“This is not just for us, but this is for the country at the end of the day.”
Budget constraints are particularly acute in smaller provinces like the Northern Cape, which has already spent R12.5 million on the audits.
Bekebeke said the financial burden is significant relative to the province’s limited resources.
“For Gauteng and Western Cape, I think that’s small change. Our budget in our office is less than R400 million per annum, and 60% of that budget goes to salaries and the rest goes to transfers and standing contracts.”
KZN warns of blind spots
KwaZulu-Natal (KZN) acting director-general, Sibusiso Ngubane, said the province has made progress in enforcing accountability through lifestyle audits.
Since August 2020, 159 investigations have been completed, leading to 186 disciplinary cases, as well as nine criminal cases and seven civil recoveries.
However, he cautioned that the system has limitations in detecting suspicious behaviour.
“The absence of red flags is not necessarily indicative of compliance, as existing legislative constraints hinder the detection of officials living beyond their means.
“One of the issues we have identified is that current controls limit the employer to verifying matters such as vehicle, property, and company ownership, whilst there are several gaps that are left unattended,” Ngubane remarked.
Ngubane emphasised that the framework needs to be expanded to improve detection and close loopholes.
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