Political parties in eThekwini Municipality had mixed reactions to the write-off of R1.1 billion in Unauthorised, Irregular, Fruitless, and Wasteful Expenditure (UIFW) during a council meeting on Thursday. 

The municipality wrote off R203 million in UIFW in relation to the procurement and Supply Chain Management (SCM) and Information Technology directorate.

Thamisanqa Xuma, chairperson of the Municipal Public Accounts Committee (MPAC), stated that the irregular expenditure incurred was due to the procurement of maintenance and support services for the current Human Capital System (Payspace).

The report stated that there were inadequate contract management processes and that the contract was approved but not signed by the service provider in the 2024/25 financial year. 

Xuma said any consequence management has been or will be dealt with in accordance with the council policy in regard to misconduct and oversight by the Financial Misconduct Disciplinary Board.

The second UIFW relates to a failure to follow the appropriate SCM procurement process and apply National Treasury Guidelines for procuring Covid-19 Personal Protective Equipment (PPE), food hampers, and temporary shelters for homeless individuals during the 2020/21 financial year audit.

The report stated that disciplinary action was taken against the employees, resulting in the dismissal of one of the employees and a final written warning for the other.

One of the officials retired before the disciplinary hearing, while another was found not guilty.

Before the January to June 2025 financial year, the Auditor-General South Africa (AGSA) found that UIFW expenditure did not comply with the Preferential Procurement Regulations (PPR) 2017. Specifically, the non-compliance was related to the condition that only locally produced or manufactured goods, meeting a minimum threshold for local production and content, should have been considered.

The audit found that 80 previously awarded contracts worth R953 million contravened the local content provisions from January to June 2025. The municipality stated that the root cause of the irregularity was due to oversight by line departments, SCM, and Bid Committees, and that this was an error of a technical nature.

Henricus van der Ryst, Freedom Front Plus councillor, said the municipality should fix the system to prevent further technical errors. 

“Our systems are failing us, and we continue on the same course with no recourse. You cannot keep on writing off debt, but then run to the bank to make loans that you will pay off in 10-15 years. This is utterly unsustainable and has to crash, leaving residents with the future debt,” he said. 

Zwakele Mncwango, ActionSA councillor, commended the fact that these reports are finally tabled before council, and that the public is now included in the steps towards implementing consequence management against officials found guilty.

Mncwango said that without accountability, expenditure will remain the order of the day.

“Our greatest concern remains the municipality’s poor track record in implementing consequence management, a fact repeatedly highlighted by the Auditor-General,” he said.

Nkosenhle Madlala, ANC councillor and chairperson of the Governance Committee, clarified that there was no corruption or breaches of the Municipal Finance Management Act had taken place.

“The ANC welcomes the reports of consequence management, stating that the financial conduct and disciplinary board has worked diligently to provide a comprehensive overview,” he said.

zainul.dawood@inl.co.za

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