Gauteng bus subsidies incurred over R12 million in irregular expenditure due to processes not being followed

The Gauteng Department of Roads and Logistics has not been implementing the bus subsidy system correctly for 2016/2017 and 2017/2018.

This information was revealed in a report of which the Democratic Alliance (DA) has had sight.

The subsidies were not properly processed, and the companies contracted to the department to provide transport for our residents were paid every month without due process being followed.

According to the report seen by the DA, the department used a specific formula to calculate how bus companies are paid their subsidies every month.

From the table below it is clear that this formula was never followed:

Contractor	Operator	Month	Escalation amount with a One (1) on the formula	Escalation factor with One (1)	Escalation amount without a One (1) on the formula	Escalation factor without One (1)	Difference
GT1187/4	JR CHOEU EXPRESS COACHES	Jun 16	R494 619.78	2.498072	R296 619.17	1.498072	R200 000.61
		Dec 16	R510 041.05	2.665835	R318 716.35	1.665835	R191 324.73
		Jan 17	R561 149.75	2.665835	R350 652.71	1.665835	R210 497.04
		Mar 17	R674 428.10	2.665835	R421 438.66	1.665835	R252 989.44
		Apr 17	R323 827.82		R204 493.95		R111 333.87
GT1187/2	AUTOPAX	Jun 16	R1 614 111.43	2.557702	R983 032.66	1.557702	R631 078.77
		Dec 16	R958 451.57	2.645681	R596 181.30	1.645681	R362 270.27
		Jan 17	R1 195 553.58	2.645681	R743 664.80	1.645681	R451 888.78
		Mar 17	R1 397 802.96	2.645681	R869 469.06	1.645681	R528 333.90
D24/96	AUTOPAX	Jun 16	R1 127 793.16	3.733532	R825 721.78	2.733532	R302 071.38
		Dec 16	R780 085.74	3.886174	R579 352.13	2.886174	R200 733.01
		Jan 17	R1 303 793.89	3.886174	R968 298.39	2.886174	R355 495.50
		Mar 17	R1 404 501.60	3.886174	R1 043 091.74	2.886174	R361 409.86
D26/96	AUTOPAX	Jun 16	R137 857.46	3.733532	R100 933.32	2.733532	R36 924.15
		Dec 16	R70 645.20	3.886174	R52 466.60	2.886174	R18 178.60
		Jan 17	R135 671.66	3.886174	R100 760.29	2.886174	R34 911.37
		Mar 17	R158 103.32	3.886174	R117 419.78	2.886174	R40 683.54
			R12 788 438,07		R8 872 312,69		R4 110 124.82

The result of not following the prescribed formula means that the department paid over R10 million to bus companies which constitutes irregular expenditure. This is worrying as the report only covers two financial years.

By not following all the processes set out by the department, the lives of our residents are being put at risk.

The audit process that bus companies undergo will ensure that all buses are properly maintained by the companies at all times. Furthermore, bus companies were paid regardless of whether or not they embarked on any trips for the month.

The DA will submit questions to the MEC for Roads and Logistics Kedibone Diale Tlabela, to determine how much money in bus subsidies has been paid to service providers over the last ten years.

Failure by the department to follow due processes opens the door to corruption. The DA will continue to demand that all forensic reports into allegations of corruption or failure to use public money accordingly be made public.

A DA-led Gauteng provincial government would immediately conduct a forensic audit into how this department has allocated bus subsidies and whether all the correct procedures have been followed. Should it be found that proper processes were not followed, the officials responsible will face swift disciplinary action.