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KZN: Nomusa Dube-Ncube, Address by KZN MEC for Finance, on the occasion of the meeting of the Chief Financial Officers ahead of the tabling of the People's Budget, KZN (03/03/21)

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KZN: Nomusa Dube-Ncube, Address by KZN MEC for Finance, on the occasion of the meeting of the Chief Financial Officers ahead of the tabling of the People's Budget, KZN (03/03/21)

KZN MEC for Finance Nomusa Dube-Ncube

3rd March 2021

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Programme Directors (Karusha Pillay from Treasury) and Natashia Soopal from SAICA)

Leadership of SAICA;

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The Accounting Standards Board;

Acting Head of Department; Nelly Shezi;

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Mr Farhard Cassamjee and officials from Treasury;

Officials from National Treasury;

Chief Financial Officers representing different municipalities;

First and foremost, allow me to extend my appreciation to the leadership of the South African Institute of Chartered Accountants and Accounting Standards Board. I thank you for allowing me to be part of the first session of this meeting.

My intention is not to make a long speech. I only want to extend an invitation to all of you as highly skilled professionals in the area of accountancy.

As from late last year and early this year – I have been interacting with senior managers in the provincial treasury.

In all my interaction, I have expressed my appreciation you colleagues, as accountants, for your continued commitment to ensure that this profession makes an impact across all spheres of government.

Ladies and Gentlemen, I do not want to dwell much on the statistics detailing the destruction and the economic challenges created by COVID-19.

However, I do believe that this profession of accountancy and you as Chief Financial Officers must emerge from this pandemic with new thinking and innovation.

This is the critical moment for you to transform and embrace new processes that uses digital platforms. This will ensure that you do your work efficiency and in a cost effective manner.

I am interested to know your state of readiness to use blockchain technologies, artificial intelligence and big data analytics. We need to have more discussion around this.

There is an urgent need to rollout automated risk management systems including integrated Supply Chain Management automation on blockchain and Artificial Intelligence.

In addition, I believe that we need to focus on project based budgeting and performance on automated cloud solutions.

We must deal with poor document management, insufficient financial resources. We must also attend to daily and monthly reconciliations to ensure that these are being done.

We must also place special emphasis on effective supply chain practices and eliminate inadequate contract management and uncompetitive or unfair procurement processes.

With meetings such as the CFOs forum I believe that these are issues that you will interrogate so that your management capabilities become sharper than before.

Ladies and Gentlemen, I will be working closely with you in order to make progress towards achieving clean audit. This is the area that we discussed extensively during Lekgotla recently.

All members of the provincial executive council, Heads of departments, CFOs and Mayors must provide leadership to ensure adherence to best financial management practices on a daily basis.

In addition, we have agreed that government departments and municipalities must work with the Treasury and AGs office on an on-going basis to detect early signs of administrative or financial distress.

A year down the line, we must be in a position to report positive outcomes out of this approach.

We must be able to point out municipalities that were in financial crisis when we started this term of office but would have shown signs of recovery before ending this term of office.

I am making this statement fully aware that we will have local government elections between August and November this year. However, the work of you as accountants must continue.

We should all promote a culture of effective risk management.

In this regard, we need to establish risk management teams that provide oversight in areas vulnerable to corrupt practices such as supply chain management units.

I believe that our improved financial management will better enable this province to grow and prosper. In managing public money properly, we will be demonstrating that we are ready to take charge of our future.

Our commitment must be informed by the fact that the people of this province and the country as a whole demand greater transparency.

Ladies and Gentlemen, having said all of that, I wish to point out that as Treasury we commit to deploy more resources to assist municipalities in improving their capacity to meet their financial obligations and commitments. This is crucial in order to provide services to the communities.

I pledge to work with you as CFOs. And I am confident of your co-operation.

Working with you is very important because, the accounting profession is the one which is clearly imbued with the public interest. 

As such, if the profession's work is to have value, post COVID-19, those who are in position of leadership must work hard to maintain and justify a high degree of public trust and confidence.

COVID-19 Accountants fighting fruitless expenditure and conserving resources

Programme Director, next week on the 9th March I will be presenting a Budget Speech.

With COVID-19, we have to acknowledge that unfortunately we live in a world where resources are limited.

It seems as we move forward, our budget will always be one of trade-offs and infinite opportunity costs. In order to finance one priority, it will mean that the other priority has to be put aside. That is the sad reality.

Of course it does not help that with all these constraints some of the people entrusted with the custodianship of public funds sometimes do not do their work with as much diligence as is required.

A cursory glance of the Auditor General’s Report reveals a plethora of instances of non-compliance, a collapse in governance and serious weaknesses.

You just have to look at how much money is lost to unauthorised, fruitless and wasteful as well as irregular expenditure to appreciate fully the potential that our resources could do.

While undeniably limited, the financial resources could be stretched to ensure that services delivery is not compromised.  It is for this reason that I will be working closely with you. 

We must work together to keep considering ways in which a culture of frugality, prudence and sound management of public resources can be embedded.

Ladies and Gentlemen, as I draw towards conclusion, I wish invite all of you to be part of community outreach programmes to be championed through my office. These will be focusing on:-

Creation of wealth;

Culture of savings;

Financial Literacy.

I know that SAICA is one of the organizations that is intimately involved in this work. I wish we could join hands and do more community work as we rebuild the economy of the province.

Financial education has been broadly defined as the capacity to have familiarity with and understanding of the financial market products, especially rewards and risks in order to make informed choices.  We need our communities to be empowered.

Viewed from this standpoint, financial education primarily relates to personal financial education to enable individuals to take effective actions to improve overall well-being and avoid distress in financial matters.

You will agree with me that financial awareness is a rare commodity in our society in general. For instance, economists frequently warn us that South Africa lacks a culture of savings, which is a catalyst for the building of personal wealth.

The lack of this basic tool of wealth creation translates into a society which has a huge debt burden which stifles and stunts economic independence.

According to economists, financial empowerment is not only about financial inclusion but it also means financial literacy.  It has been pointed out that financial education should be practical and begin at an early stage in people’s lives.

I wish to use this opportunity therefore, to invite SAICA and CFOs to join hands with me and be part of this community outreach programme.

In each village, each township and every corner of this province we must have ambassadors who are empowered with financial skills. Every household must have such an ambassador.

My office we will give you more details regarding this community work as we move forward.

Once again, I wish to express my appreciation to SAICA and all of you.

I thank you for the opportunity to interact with you.

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