Limpopo faces a potential shortfall of R2-billion at the end of the financial year, the Ministry of Finance said on Thursday.

"Why has this situation come about in Limpopo? The province has large, accumulated unauthorised expenditure which has grown from R1.5-billion in 2009 to R2.7-billion 2011," the Ministry said in a statement.

The statement was released during a news briefing giving an update after the province was placed under administration in December.

The Cabinet put the province under administration after it emerged that Limpopo was bankrupt and could not pay civil servants, such as teachers and nurses.

The team found that, in the health department:

• the province owed suppliers R138-million, but only half these payments, R67-million, could be verified and approved for payment by December 23;
• R427-million in assets had no supporting documents;
• there was R400-million in irregular expenditure of goods and services, mostly medical equipment.

Education Minister Angie Motshekga said that in the province's education department there was no supply chain management, with the department not ordering pupil support material on time.

It accumulated unauthorised expenditure of R2.2-billion and there was a R190-million accrual of "stale debt" – money owed.

At least 200 "ghost" teachers were paid and there were 2 400 excess teachers in the province.

Certain schools had not got the money they needed in 2011 for basics such as electricity and photocopying.

Public Works Minister Thulas Nxesi said the modification of existing contracts to push up tender values and consultancy fees contributed to the financial crisis,

"A security contract of R1.8-million a month, and I am not saying a year, a month – was extended without proper procedures from 2010," Nxesi said at the briefing.

He said supply chain violations, tenders awarded without proper processes and no asset management were also found.

"We cannot run government like this," he said.

Transport Minister Sbu Ndebele said there was no contract management system in place in the province's transport department.

There was also no oversight of the Limpopo Roads Agency.

Public Service Minister Roy Padayachee said the security of the public service was critical. If public servants were not paid, public services could not be delivered.

On November 22, it was discovered that Polokwane could not pay its civil servants