The National Prosecuting Authority (NPA) has run out of money and the Justice Department has refused to bail it out, City Press reported on Sunday.
The NPA was implementing strict austerity measures in a desperate bid to "salvage its financial position", according to an internal NPA memorandum sent to the newspaper.
The measures included freezing non-essential posts and shelving the aspirant prosecutor programme.
There was "no hope of a rescue plan from the Department of Justice or from Treasury".
The memorandum shows the NPA had overspent R72-million on employee compensation.
Last year, acting NPA head Nomgcobo Jiba warned parliament's portfolio committee on justice and constitutional development that the organisation's "impact on crime [was] likely to be affected by budget constraints".
The financial situation was exacerbated in November when the NPA lost a five-year legal battle with the Public Servants' Association and had to pay out R55-million to employees, the newspaper reported.
The NPA received R2.1-billion for compensation of employees.
It had received an unqualified audit and overspent its budget by nearly R32-million.
There was also irregular expenditure of about R11.7-million. The NPA said disciplinary action had been implemented.