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UKZN's explanation for R1,9bn deficit inadequate - Belinda Bozzoli

DA MP says university should be called to parliament to account for matter

UKZN must appear in Parliament over finances

11 December 2014

The University of Kwazulu-Natal has failed to account adequately for the R1.8 billion deficit which appeared in its 2013 audit, in spite of having issued both a public statement and a letter to its staff on the matter (see Daily News report). 

I have today written to the Chairperson of the Portfolio Committee on Higher Education and Training, the Hon Yvonne Phosa, requesting her to invite the University to present itself to the Committee as soon as possible.

In the letter to staff the University denies that the deficit was created in the course of a single year, and attributes most of it to "infrastructure spending" and post-retirement medical aid liabilities. This does not constitute an adequate explanation. The University must clarify what this was spent on, and how it was mismanaged to the point where such an untenable deficit has been created. 

The University also makes a dubious distinction between "Council controlled funds" and other funds, suggesting that the deficit within Council controlled funds is "only" R353 million, and strongly implying that the University has large, but unspecified, debts in entities outside the control of the Council. These debts, according to the University, "are sufficiently covered by the University's investments" - thus implying that the University is indeed liable for these debts irrespective of where they lie and that the University's reserves may be used to cover them. 

UKZN is a public institution and should account to Parliament for these and other ambiguities in its finances. 

Statement issued by Prof Belinda Bozzoli MP, DA Shadow Minister of Higher Education and Training, December 11 2014

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