The Democratic Alliance (DA) in Limpopo has called on the MEC for Transport and Community Services, Violet Mathye, to urgently implement alternative targets for Gateway Airport Authority Limited (GAAL) before the end of this financial year and to commit to stop all funding to GAAL.
This follows yet another scathing report by the Standing Committee on Public Accounts (SCOPA) based on the Auditor-General’s (AG) findings, which highlights the persistent financial mismanagement of GAAL for the financial year ending 31 March 2024.
It is concerning that GAAL lacks even the most basic of financial control:
- The majority of the R676 502 in Fruitless and Wasteful Expenditure was in respect of SARS interest and penalties for non-compliance as well as interest levied on late payments to suppliers, which is totally preventable.
- Financial statements submitted for auditing were not fully prepared in accordance with the prescribed financial reporting framework.
- Effective and appropriate steps were not taken to collect revenue, a rudimentary requirement to be profitable.
The AG’s indication that there is significant doubt on GAAL’s ability to continue as a going concern is worrisome; SCOPA has heard and considered evidence provided that the GAAL has incurred a deficit of R10,652 434 000 for the financial year ending 31 March 2024.
Furthermore, GAAL’s liabilities exceeded its current assets by R16, 975 861 000.
It is clear that the current flawed turn- around strategy failed dismally to improve the financial viability of the entity.
Since its establishment in 1995, GAAL has failed to turn a profit and solely rely on the handouts of the provincial treasury and the Department of Transport and Community Safety.
Funding to GAA must be stopped in the new financial year; Limpopo can no longer afford to support failed entities whose sole purpose seems to be the financial well-being of the connected few with no interest to turn a profit.