Media Statement - Standing Committee On Public Accounts (scopa) Alarmed Following Oversight Visit To Two Eastern Cape Municipalities

CAPE TOWN, South Africa, March 31, 2025/APO Group/ --

At 8 pm on Friday, 28 March 2025, the Standing Committee on Public Accounts (SCOPA) concluded its week-long oversight visit to the Eastern Cape’s OR Tambo District Municipality and Buffalo City Metropolitan Municipality where it noted with alarm the state of most of the projects it visited at both municipalities.

The projects were chosen following the reports the committee received from the Auditor-General of South Africa (AG) and the Special Investigating Unit (SIU). Key oversight observations: 

• Chronic capital project delays with cost overruns being the norm rather than the exception, to the tune of hundreds of millions.
• Persistence of years-long legacy of supply chain and financial management misdeeds and mismanagement – leading to write-offs or unresolved irregular expenditure.
• Consulting engineers certify invoices for payment when work has not been completed and are never held accountable.
• A culture of no consequences, with executive authorities either quashing reports on malfeasance or defending inexcusable failure to act.
• Infrastructure departments and projects appear to be a cesspool of malfeasance and maladministration.

OR Tambo District Municipality The committee visited the Lusikisiki Sewerage Project, whose third phase has been plagued by delays, with a service provider abandoning the site after it ran out of funds. The committee found on the site abandoned pipes and materials that, according to the municipality officials, are still usable. But the committee could not ascertain whether any had been stolen. The visit was followed by a visit to Ntsonyini Dam in Port St. John’s, which has also been delayed for years, notwithstanding a lot of money spent on it. The committee found a lot of unused materials strewn at the site, yet the project is still far from completion and more money is needed to complete it. Other parts of the project, which depend on the dam, have nonetheless progressed but cannot be utilised due to the delayed completion of the dam. Members of the committee were alarmed to learn that some senior officials who have been arrested on more than one occasion are still on duty, with the Municipal Manager and the Executive Mayor defending their continued presence at work. The committee made its displeasure clear and demanded that immediate action be taken to protect the integrity of the district municipality. In other cases, the committee found that the director of a company recently awarded a contract of over R105 million has been charged with fraud pertaining to Alfred Nzo District Municipality and officials claimed to be unaware about that. The Mqanduli Bulk Water Project which was also visited by the committee, is beset with various problems, despite upbeat reporting by officials. The OR Tambo District Municipality is unable to draw water from Mthatha Dam due to a defective pipe owned by the Department of Water and Sanitation and instead draws directly from Mthatha River. The Thornhill Water Treatment Works is, in any event, below the capacity needed to supply the network of reservoirs that are supposed to bring water to urban and rural residents in the district. The committee heard residents complaining of frequent and drawn-out water shortages and received from officials accounts of old infrastructure that breaks down often, leading to further water cuts. This affects both households and Walter Sisulu University. Although the committee has noted signs of improvement in audit outcomes at the OR Tambo District Municipality, it remains deeply concerned by project delays, cost overruns, lack of consequences for errant officials and seemingly poor due diligence in the selection of service providers. Buffalo City Metropolitan Municipality The committee visited the Zwelitsha Waste-water Treatment Plant, which has been beset by chronic delays, mainly involving litigation and payment disputes. The plant remains incomplete and is causing delays in housing developments in the region. The site is poorly maintained, frequently vandalised and is vulnerable to organised crime. However, it was at the Mdantsane NU2 Swimming Pool and Water World projects where the committee experienced first-hand the most egregious examples of years of mismanagement, malfeasance and possible fraud and corruption. While R57 million and R121 million have been spent at Mdantsane and Waterworld respectively, both projects are effectively unusable due to neglect, vandalism and non-existent maintenance. The committee was further alarmed to learn that the Speaker of Council, the Chief Whip and the Executive Mayor have on more than one occasion quashed damning reports pertaining to the projects. They were unable to provide convincing reasons why this was the case, leading to what appears to be a culture of impunity and procurement malfeasance. Conclusion The committee will carefully consider its observations and table a comprehensive report before the National Assembly. Some matters will be referred to the AG for special audits and the SIU to pursue civil recoveries against service providers and staff. It also became clear to the committee that urgent action must be taken in respect of supply chain, infrastructure and project management units where most of the malfeasance appears to be rooted, with some officials reportedly owning assets well beyond the salaries they earn. While the committee noted that OR Tambo District Municipality and Buffalo City Metropolitan Municipality had recovery programs in place, it is nonetheless clear that both are far from recovery.