DA successfully persuades the Auditor General to investigate financial irregularities in the Mpumalanga Economic Growth Agency (MEGA)

Issued by Sydney Masinga – Media Officer
27 Aug 2020 in Press Releases

Democratic Alliance Statement by

Bosman Grobler MPL

Spokesperson on Finance & Economic Development

The DA successfully persuades the Auditor General to investigate financial irregularities in the Mpumalanga Economic Growth Agency (MEGA)

27 August 2020

Release: Immediate

The Democratic Alliance (DA) in Mpumalanga is pleased to announce that it has successfully persuaded the Auditor General (AG) to investigate financial irregularities within the Mpumalanga Economic Growth Agency (MEGA).

The DA Wrote to the AG in the beginning of August asking for a discretionary audit to be done in MEGA following a report by the entity which was provided to the Mpumalanga Legislatures portfolio committee in Finance, Economic Development and Tourism whereby it reflects the deteriorating financial state.

Recently the DA received a response back from the AG stating that a Discretionary Audit will be conducted on MEGA.

The AG performs a Discretionary Audit and a report on factual findings with regards to financial misconduct, maladministration and impropriety, based on allegations or matters of public interest.

The DA welcomes the AG’s decision to conduct the investigation into MEGA, and we hope this will be the turning point where the Provincial Government realised that more needs to be done to rescue Mpumalanga from further economic decay.

MEGA provided loans during the financial year 2019/2020, which is in line with their mandate, however, MEGA’s loan book shows that as of 1 January 2020 – the loan book had a balance of R176 270 245, and the arrears as of January was at R88 734 863 which constitutes 50% of the loans are in arrears.

The DA is concerned with MEGA not being financially viable to deliver on its mandate as required by the law.

Furthermore, MEGA was only able to collect R18 487 878 (10%) of the outstanding monies in 9 months of the 2019/2020 financial year.

In the past two financial years, MEGA has reported a net loss according to the annual report for 2017/18 of R138 987 583 and R63 627 573 in the 2018/19 financial year. This is a net loss of more than R202 Million.

The entity also struggled to meet its target on generating income and therefor the revenue decreased from R196 521 112 in the 2017/18 financial year, to R190 767 871 in the 2018/19 financial year, and further reduced in the 2019/2020 financial year to R183 273 296.

Once again, the DA’s call for MEGA to be disbanded continues to be backed by concrete statistics. The provincial economy has and continues to be stagnant. This province is in dire need of a government that possess the right leadership with the political will to make necessary changes, so that the lives of residents can improve.

Media Enquiries:

Bosman Grobler MPL

Spokesperson on Finance & Economic Development

083 697 0747

Sydney Masinga

Media Officer

060 971 4297