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Central Energy Fund wastes R24 million

The Central Energy Fund (CEF) incurred fruitless expenditure of R24.45 million and another R600 000 in irregular expenditure, according to the entity’s 2010 financial report tabled on Thursday.

Auditor General Terence Nombembe said the fruitless expenditure largely consisted of interest and penalties on taxes not paid and interest on late payment of suppliers.

PetroSA was the worst offender in the CEF stable in this regard.

The company needed to pay the South African Revenue Services R13 million in interest on VAT withheld, and also fell foul of tax authorities in the United States and Equatorial Guinea. It was obliged to pay the taxman in the west African state R279 000 in fines for late submission of tax returns in 2009 and 2010.

The Strategic Fuel Fund (SFF) was disputing an interest payment of R10.5 million exacted by Sars as a result of its 2006 tax assessment.

PetroSA was also to blame for irregular expenditure of R685 000, which resulted because a contract was signed by an employee lacking the necessary authority.

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