It has emerged that one of the areas that the government has to target as part of its cost cutting measures is excessive expenditure on office space rental.
Millions of rand in taxpayers’ money has been paid for government leases with the private sector for unoccupied properties, Public Works Minister, Thulas Nxesi disclosed during his department’s budget vote.
“The DPW [Department of Public Works] has been paying rental to the tune of R5m per month for 108 properties that were vacant or unoccupied,” Nxesi said.
“The DPW leased accommodation for government-user departments, but 12 properties were occupied by non-government tenants, at a cost of R1m per month.”
The shocking findings followed a review of the conducted in collaboration with National Treasury, included a review of 2162 property leases.
The department identified almost 600 cases where lease agreements could not be found, resulting in irregular expenditure.
To rectify the problem, the department has overhauled SCM [Supply Chain Management] processes in the leasing environment and negotiated, with National Treasury, a special dispensation to fast track the re-signing of expired leases, Nxesi said.