The eThekwini Municipality racked up more than R4.4 billion in irregular expenditure during the 2024/25 financial year.
- The eThekwini Municipality racked up more than R4.4 billion in irregular expenditure during the 2024/25 financial year.
- A major portion of the unauthorised spending was tied to controversial water tanker contracts and a plumbers’ programme, which is now under investigation.
- Parliament’s public accounts committee demanded immediate accountability from City.
The eThekwini Municipality has been rocked by a staggering R4.4-billion irregular expenditure bill for the 2024/25 financial year, driven by controversial water tanker contracts and severe supply chain management failures.
The damning details emerged during a briefing to Parliament’s Standing Committee on Public Accounts (Scopa), where the City’s leadership faced intense scrutiny over material irregularities and crumbling governance systems.
Scopa chairperson Songezo Zibi said the hearing was part of a targeted oversight drive into South African metros acting as vital economic hubs.
“The main reason behind our meeting today is that the Auditor-General gave us a briefing on financial issues about the City of eThekwini’s audit outcome. That’s at the core of why we are here,” Zibi said.
An 86-slide report presented to the committee showed that the City’s irregular expenditure skyrocketed to R4.48 billion. Furthermore, an older balance of more than R3.2 billion, linked to 64 separate items, has been referred to the Municipal Public Accounts Committee (Mpac) for formal investigation.
A massive chunk of this wastage is tied to the City’s heavily criticised water tanker programme. Spending on these temporary water trucks ballooned from R102.6 million in the 2020/21 financial year to a massive R814.8 million in 2024/25, costing taxpayers R1.8 billion over five years.
The report noted that R657 million in irregular expenditure stemmed specifically from hiring the water trucks while the City was supposedly trying to buy its own fleet.
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eThekwini chief financial officer Sandile Mnguni said the City was probing allegations of massive overpayments, double value-added tax (VAT) charging, and paying for tankers that allegedly never delivered any water.
“We have referred the matter to your investigation unit, but at the same time, some of the amounts that were noted by the Auditor-General were already noted by the system. We will act as soon as we receive a report on this matter,” Mnguni said.
Mnguni insisted that the City had made progress in moving away from private contractors to curb the bleeding.
“Last year, we acquired 100 water tankers, and the year before, we had also acquired 100 more, and before that, it was 55. So we have our own water tankers now, and we no longer rely on external service providers,” Mnguni added.
Beyond the water trucks, the municipality admitted that weak contract management, unauthorised procurement deviations, and tender splitting had crippled its finances. Another R799 million in irregular expenditure relates to a local plumbers’ programme, which Mnguni admitted flagrantly violated the Municipal Finance Management Act (MFMA) by bypassing approval processes for contracts exceeding three years.
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Democratic Alliance MP Farhat Essack launched a scathing attack on City officials, accusing City manager Musa Mbhele of failing to enforce accountability.
“How does one explain this… I mean R4.4 billion irregular expenditure? In the 2023/24 financial year, you had R1.6 billion irregular expenditure. So in 24 months, R6.4 billion was written off in two financial years. I mean, in the interest of accountability, how do you account for such an amount being written off? Who is responsible? What is going on?” Essack asked.
Defending the spike, Mnguni claimed a large portion of the non-compliance was technical and linked to 2017 Preferential Procurement Policy Framework Act regulations regarding local content.
