LOBAMBA – Auditor General Timothy Matsebula has rejected a request by the Eswatini Tourism Authority (ETA) to write off E5.9 million owed to government.
Matsebula argued that the authority had recently recorded financial surpluses and continued to benefit from increased government subventions.
The matter came under scrutiny yesterday when the Ministry of Tourism and Environmental Affairs appeared before the Public Accounts Committee (PAC), alongside its parastatals, to respond to issues raised in the Compliance Audit Report of Public Enterprises and Local Government Authorities for the financial years ended March 31, 2023 and 2024.
The ETA, led by Chief Executive Officer Vusi Dlamini, was reporting on progress in addressing previous auditor general concerns.
Key issues in the audit included liquidity constraints, accumulated losses, negative equity and challenges in collecting and remitting bed levy funds.
The report shows that as of March 31, 2024, ETA’s liabilities exceeded current assets by E4 820 362, with liabilities at E12 629 763 against assets of E7 809 401.
In the previous year ended March 31, 2023, the gap was E8 617 447, with liabilities of E11 853 214 and current assets of E3 235 737.
Matsebula warned that this position suggested potential difficulties in meeting both short- and long-term obligations as they fall due.
“I requested management to account for the current financial position and submit strategies to improve its financial position, especially the insolvency and liquidity,” the AG stated.
He added that the controlling officer attributed the constraints to the historical build-up of high liabilities without a clear repayment plan.
Appearing before the PAC, Dlamini said the ETA had made progress in reducing its debt since the current management took office. He said the authority had engaged the Eswatini Revenue Service (ERS) to manage debts and had settled some long-standing obligations. “When we arrived in office, we engaged ERS to find ways of reducing our debts. We can report that we have paid the debt fully, the cost was around E1.5 million,” Dlamini said. He also said debts owed to the Eswatini National Provident Fund (ENPF) had been settled, though final confirmation documents were still outstanding.
However, he acknowledged ongoing challenges with historical bed levy debts dating to the COVID-19 period, when financial strain and reduced government subventions led to the use of collected levies for operational needs instead of remittance.
Under the arrangement, hospitality establishments pay a three per cent bed levy, with half remitted to the Consolidated Fund and the other half retained by the ETA.
“We did not do that. We have engaged the Ministry of Finance to request that the old debt be written off and we are still negotiating for a waiver,” Dlamini said. He added that compliance had since improved, with ETA now remitting government’s 50 per cent share of bed levy collections from 2024 onwards.
However, Matsebula opposed the waiver request, insisting the authority must repay government.
“The authority needs to pay the money. Just because government does not collect the money itself does not mean they must use it willy-nilly. They must pay it back to government,” he said.
He added that continued government subventions and recent surpluses made the request unjustifiable.
According to the AG, ETA recorded a surplus of E3 613 546 in the year ended March 31, 2024, compared to a deficit of E1 813 604 in the previous year.
Despite this, accumulated losses stood at E4 052 674 as at March 31, 2024, resulting in negative equity. This was an improvement from E7 666 220 in 2023.
Matsebula said the losses stemmed from prior-year deficits, adding that the authority remained heavily dependent on government support.
He noted that the 2024 surplus was largely driven by an increased government subvention, which rose by E2 964 092 (20 per cent), from E14 676 928 in 2023 to E17 641 020 in 2024.
He further advised the authority to strengthen revenue mobilisation and cost control.
Dlamini said cost-cutting measures had reduced expenditure by E1 687 611. He also reported surpluses of E3 819 694 in 2025 and E3 384 948 in the 2026 financial year, saying this reflected a path towards eliminating accumulated losses and achieving positive equity.
The PAC raised concerns over bed levy compliance, noting that a significant number of establishments were not paying. Nhlambeni MP Manzi Zwane questioned whether the authority had a comprehensive strategy to improve collections.
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