Speaker, both the Energy Sector Education and Training Authority and the Public Services Sector Education and Training Authority obtained disclaimers of audit opinions, as the previous speakers have indicated. This is the worst possible audit determination that the Auditor-General can make.
Frequently, a poor audit outcome is reflected in poor service delivery. It is urgent, therefore, that effective interventions are put in place to ensure that matters raised by the Auditor-General are corrected.
The Setas are just too important to job creation and skills training that there should be any doubt regarding their financial wellbeing. However, hon Speaker, I believe that progress with regard to both Setas is being made.
The Minister has, since the disclaimers, put both Setas under administration in line with section 15 of the Skills Development Act. The mandate of the appointed administrators includes taking over the role of the accounting authority of the Eseta and also includes a review of the conditions of employment of the chief executive officer, chief financial officer and other employees.
There are signs, at least with the Eseta, that the situation is being turned around. For the 2010-11 financial year, the Eseta, while not receiving a completely clean audit, has at least not received another disclaimer. The Eseta has also taken disciplinary action regarding unauthorised, fruitless and wasteful expenditure raised in the resolution before the House today. If the urgent and immediate objective is for the Eseta to receive clean audits, the following five things need to be done with haste: implement effective internal control systems; ensure leadership of the highest calibre at the level of board and management; provide adequate training to staff for the necessary skills for proper and accurate accounting; have properly-functioning internal audit systems and audit committees; and impose strict adherence to the Public Finance Management Act, Treasury regulations, and other relevant prescripts.
Speaker, if these basic requirements of good governance are implemented, then there is no reason why the history of disclaimers, which these Setas have received, should not be a thing of the past.
In terms of the resolution before the House, as the chair has indicated, the executive authority, the Minister, is required to report back to Parliament within 60 days of this resolution. We look forward to his report.
Speaker, that the situation can be turned around is evident in the Department of Defence and Military Veterans, the resolution of which is also tabled here today, and which was also referred to earlier by the chair of the committee.
Their asset register continues to be a stumbling block to receiving a clean audit. However, under strong leadership, the department has reduced the number of qualifications from eight in 2008 to six in 2009, and to one in the 2010 financial year.
Speaker, this is indeed progress and I believe, if emulated across other departments and entities, the situation with regard to audit opinions could be turned around. The ANC supports the resolutions before the House. Thank you. [Applause.]