The Treasury has closed over 120 ministerial bank accounts since 2013 as it continues to advocate that ministries have minimal bank accounts.
This was revealed by Prime Minister Saara Kuugongelwa-Amadhila on Thursday while answering questions in the National Assembly from United Democratic Front president Apius Auchab.
Auchab wanted Kuugongelwa-Amadhila’s view on whether it is justifiable for ministries to have multiple bank accounts.
Kuugongelwa-Amadhila said the Treasury has in recent years observed that there has been an escalation in the number of ministerial bank accounts.
“It is not illegal for ministries to have multiple bank accounts, but as we know the accounts should be authorized by Treasury. But this is only permissible when circumstances warrant, because the state deems it appropriate that money be held in a consolidated ministerial account,” she said.
She said that special ministerial projects require dedicated accounts.
“It is not possible to close all the extra accounts because there are times when you have donor-funded projects and those donors want their money to be kept in a separate account and if you close it they might take back the funds.
But despite that, Treasury tries by all means to advise against the proliferation of bank accounts within ministries,” she said.
New Era in the past reported that most line ministries hardly provide source documents relating to bank accounts to the auditor general (AG) for audit purposes. This has prompted the AG, in many of his reports on the accounts of line ministries, to stress that ministries should provide source documents for audit purposes.
The AG’s report on the accounts of the Ministry of Education for the financial year ended 2012 indicates that the ministry has 43 separate bank accounts with Nedbank, First National Bank, Standard Bank and Bank Windhoek.
Meanwhile, for the same financial year, the Ministry of Environment and Tourism operated 18 bank accounts, but the accounting officer did not submit any source documents such as a cashbook, bank reconciliation statements and income and expenditure statements for seven bank accounts for audit purposes.
During the 2012 financial year, the Ministry of Gender Equality and Child Welfare operated 12 bank accounts.
Another report, which New Era stumbled upon, is that of the Ministry of Health and Social Services. The AG’s 2009 report on the ministry’s accounts indicate that the ministry operated 43 accounts but the accounting officer at that ministry failed to submit the bank statements and necessary documents and records to enable the auditors to audit the petty cash account and cash advance bank account, which are operated by ministerial staff.
The chairperson of the Parliamentary Standing Committee on Public Accounts, Usutuaije Maamberua, said that government ministries with multiple bank accounts – some as many as 40 – run the risk of losing money because of lack of control.
“If you have too many bank accounts you lose control over them and at the same time the transparency of that ministry comes into question, because the financial system of an institution with many bank accounts cannot be transparent. Even the auditing processes are made difficult,” warned Maamberua at the time.
Maamberua feared that some of the bank accounts may go unnoticed since there may be ministries which perhaps do not declare all accounts.
The fact that some line ministries have more than 30 bank accounts attached to their names could have serious implications on the control and regulation processes within such ministries. This is also the reason why in most instances bank accounts are not reconciled and statements are seldom availed for auditing purposes.