Former Mining Minister, Lebohang Thotanyana, who is also a chartered accountant and businessman, says the country’s poor public financial management could knock down investor and donor confidence; something that could spell more gloom for a country which relies on external funding to support its development.
Lebohang Thotanyana (pictured)
This he said when commenting on the unfavorable picture painted by acting Auditor General Monica Besetsa’s recent assessment on the management of the government finances for the 2019/200 fiscal year.
“The most damning thing for this collapsed state of public financial affairs is possible erosion of investor, donor and lenders’ confidence in the country. We are nearing a failed state situation.”
He said donors could cut down on monetary assistance to Lesotho because “nobody trusts us to handle their finances.”
Thotanyana said there is an urgent need to overhaul the country’s public financial management architecture through change of government.
“We need a new government that can breathe new life into the ailing government financial systems, because the current regime has failed to address it.”
For his part former Accountant General Sam Mphaka said there is need for separation of powers between the executive and legislative arms of government as this can give parliament the teeth needed to tackle misuse of public finances.
“There is a clear conflict of interest in the functions of the two public institutions under the current dispensation and the fact that ministers are both players and referees by being in both the executive and parliament makes the latter toothless in taking a hard stance on accountability of government funds usage.
“This situation creates a problem of weak internal controls in government in that the minister is the one who executes public funds while simultaneosly being the parliamentarian who oversees the funds’ usage.
“So, ministers are not afraid to misuse public funds because they know that even if the Auditor General can make recommendations, nothing will happen since the buck stops with parliament as members will not shoot themselves in the foot,” said Mphaka.
He said the situation has also created a loophole that is being exploited by public officers and the problem can be addressed by amending the national constitution to ensure that ministers are not appointed from within parliament.
On the other hand, Robert Likhang, a chartered accountant and business consultant, said the perennial misuse of public funds means the country is failing to meet its strategic objectives such as economic growth and creating jobs.
He also believes that professionalization of public accountants can go a long way in addressing the situation.
“Professionalizing the entire accounting cadre in public service can also go a long way in addressing problems of poor financial management. The proposed move for professionalization of the public accounting cadre has previously been frustrated by politicians who were not keen on it.”
Chaka Nkofo, the chief executive of Institute of Directors (IoD) Lesotho said the shocking state of public financial management reflects poor governance in the public service.
“Some of the issues raised by the Auditor General reiterate what we have previously sat on the need for governance code in the country. We have a catastrophic state of governance whereby public funds are misused without any remorse, which is tantamount to theft. We have normalized this state of affairs in public service in recent years,” Mr Nkofo said.
