Inside Joburg's R9m scandal: How the city is fighting back
The City of Johannesburg council meeting has sanctioned the recovery of nearly R9 million in irregular, fruitless, and wasteful expenditure, along with the laying of criminal charges related to the matter.
Image: Nhlanhla Phillips / Independent Newspapers
The Municipal Public Accounts Committee's (MPAC) recommendations to recover nearly R9 million in wasteful, inefficient, and irregular expenditures, as well as referrals to the police and its disciplinary board, have been approved by the City of Johannesburg council.
On Wednesday, the council also approved the referrals for its suspected misconduct in the Public Safety Department and Group Corporate and Shared Services (GCSS).
In addition, the new City Manager, Dr Floyd Brink, is required to submit standard operating procedures, controls in terms of Section 29 of the Municipal Finance Management Act (MFMA), and budget rebasing procedures within 30 days.
According to DA Councillor Zander Shawe, the MPAC determined that over R868 million was “gone forever”. This figure results from R354 million in irregular expenditure that requires regularisation and R514 million in unauthorised expenditure that must be written off.
“Let's speak plainly. Almost R1 billion was wasted because departments did not follow the law.
“This report identifies exactly who the culprits are. Group Risk Assurance services have irregularly spent just under R370m due to improper contract management over multiple years,” he said.
Shawe said Public Safety overspent its budget by over R514m.
“That's half a billion rand lost through poor financial discipline and money that could have repaired fire engines or improved JMPD (Johannesburg Metro Police Department) visibility,” he stated.
According to Shawe, the MPAC recommends the recovery of R1.7m in fruitless and wasteful expenditure and over R7.2m in irregular expenditure, and includes referrals to disciplinary boards and the SA Police Service (SAPS) for suspected misconduct in Public Safety and GCSS.
MPAC Chairperson and EFF Councillor Sepetlele Raseruthe said in terms of the MFMA, a municipality must recover unauthorised, irregular, or fruitless and wasteful expenditure from the person liable for that expenditure unless the expenditure, after investigation by a council committee, is certified by the council as irrecoverable and written off by the council.
“Further, according to Regulation 74(1)(d) of the Municipal Budget and Reporting Regulations of 2009, once a council committee has investigated the recoverability of unauthorised, irregular, fruitless, and wasteful (UIFW) expenditure, the committee must submit a motivation to council explaining its recommendations regarding the recoverability of the expenditure,” he explained.
Raseruthe said at its meetings last month, the MPAC agreed to recommend to council that UIFW expenditure be recovered.
“This expenditure covers various core departments. The expenditure range from 2017 to 2018, 2024, and 2025 financial years,” he added.
Raseruthe continued: “As the committee, we are encouraged that some of these matters will be referred to the disciplinary board for further investigation, where elements of financial misconduct have been identified.
“In some cases, the committee even recommended that certain matters be referred to the SA Police Service, where elements of fraud and criminality were identified.”
African Christian Democratic Party (ACDP) Councillor Ronald Harris said the MFMA does make provision for what is being requested in the report, and morally correct to do so.
“(As) the ACDP in good conscience, we simply cannot support this request because, really, to write off R868m, the optics of it is just totally unacceptable from the ANC,” he said.