Contracts worth R165 million were awarded to suppliers in which government employees‚ including political office bearers‚ had an interest.

Parliament is listed as one of the bodies in which awards were made to suppliers where political office bearers had an interest in that supplier.

Awards to the value of R604 million were made to companies owned by close family members of government employees.

This is among the findings made by the Auditor-General’s Consolidated General Report on National and Provincial Audit Outcomes for 2016-2017‚ released on Wednesday.

The Auditor-General had been auditing and reporting on weakness in supply chain management for a number of years.

At five audited government institutions‚ awards were made to suppliers in which political office bearers had an interest.

These are Mthashana TVET College‚ Umfolozi TVET College‚ Parliament‚ the Northern Cape Provincial Legislature and the Wholesale and Retail Sector Education and Training Authority.

The Auditor-General identifies suppliers in which employees or their close family members have an interest through basic data analysis.

However‚ this analysis has its limitations as the Auditor-General can only test registered companies and the office does not have information on all family members.

The report said as public bodies were not prohibited by current legislation to make such awards‚ the compliance findings that the Auditor-General raised related to employees and suppliers not declaring their financial interests.

The Auditor-General had identified a number of instances where employees and suppliers did not comply.

These included suppliers owned or managed by employees of government bodies who made false declarations in awards of R106 million at 12 government departments. Those owned by close family members made false declarations in awards of R178 million.

The Auditor-General also said 16 government departments did not request declarations of interest as part of the procurement process‚ as required by legislation. As a result‚ these bodies could not identify that employees had an interest in awards of R10 million and close family members in awards of R111 million.

The Auditor-General also found that at 31 audited government departments‚ employees failed to declare their own interest in awards of R54 million as part of the procurement process or through annual declarations. At 44 departments‚ employees failed to declare their family members’ interest in awards of R274 million.

“We again point out that a failure by suppliers to declare the interests of employees constitutes a fraudulent act‚ which should be investigated and dealt with in accordance with legislation.”

It said although there was no legislation that prohibited making awards to suppliers in which state officials had an interest‚ the amended Public Service Regulations prohibited employees of departments from doing business with the state from August 1 last year.

However‚ the regulations allowed employees that were doing business with the state on August 1 2016 until February this year to stop the business or resign as an employee.

Since the Auditor-General started auditing this regulation‚ it found that 698 employees at 24 departments took no action during this transitional period and continued doing business with the state.

It also found that 649 employees at 32 departments secured new awards after August 1 2016‚ even though this was prohibited.