CHARGES EXCEED INTEREST IN 10 DORMANT GOVT ACCOUNTS

MBABANE – There are 10 dormant government accounts that have incurred bank charges which outweigh the interest earned in those accounts.

The inactive programme accounts, according to the Auditor General, Timothy Matsebula, need to be closed with immediate effect as they are causing a drain to government coffers, with some of them being overdrawn and accumulating bank charges.
He said this was discovered during the financial year ended March 31, 2020. “The bank charges exceeded interest earned and continued to accumulate deficit that resulted in overdrawn investment balances and depleted the bank balances (cash position),” stated the AG in his Consolidated Government Accounts Report for the financial year ended March 31, 2020. The report was tabled by the Minister of Finance, Neal Rijkenberg and is yet to be deliberated and adopted by the Public Accounts Committee and by Parliament at large.  

Among the dormant accounts are the Swaziland Higher Education Council Accounts, Swaziland Government UNICEF on Education and Training and the Swaziland Government Statistical Capacity Building Account. The others are the Special Care Medical Aid (Phalala) Fund 2 and the Swaziland Government Commonwealth Judges. Matsebula stated that the accountant general and the responsible controlling officers were requested to evaluate the economic perspective of the dormant or inactive accounts and recommend accordingly. The AG further advised the accountant general that it was not economically prudent to keep an account with no activity (transaction) except for the bank charges exceeding the interest earned and reducing the cash balance (position).
“If there are no ongoing programmes/activities for the dormant or inactive accounts, it is economically wise to bring such accounts to closure and transfer the remaining bank balance to the General Account, to avoid any further reduction of available cash through bank charges,” reported Matsebula. He recommended that the accountant general should engage the respective controlling officer to close dormant accounts, because they continue to deplete the cash balance of government.

Overdrawn

In the case of the Swaziland Government Statistical Capacity Building Account, the AG reported that the account had no activity except for the bank charges of E618.58, which included a debit interest due to the overdrawn bank balance. “The bank balance was completely depleted from E51.76 to an overdrawn balance of E566.82, by the bank charges,” noted Matsebula. He said this continued to incur bank charges and debit interest, both increases the debt that government has to settle with the bank, from public funds. The AG reiterated that in terms of value for money it was not economically sound to keep bank accounts active at the end of a project or programme. He said as such, if there was no immediate plan to carry on with the programme, the account should have been brought to closure immediately.  

In a response dated January 12, 2021, the Ministry of Economic Planning and Development stated that a written request was made to close the special account number 100016-2070-14 on March 24, 2020 to the accountant general. It was stated that the account had a negative balance of E513.33 as at February 29, 2020. However, there was allegedly no response from the accountant general, and the account remained accumulating bank charges which increases the overdrawn bank balance.
“This is an uncalled for loss of public funds. To avoid any further loss of public funds, the accountant general should close the account with immediate effect, otherwise be surcharged for this loss,” stated the AG.

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