Buffalo City metro’s hopes of recovering more than R632m in irregular expenditure from city officials have been dashed because the council failed to act in time.
This is according to city manager Mxolisi Yawa, who recently told the council in a report that the amount should be written off as irrecoverable.
Yawa said the deadline to recover the money expired in June 2024.
He added that some senior officials who were responsible for the spending had since left the municipality, making it impossible to take action against them.
The spending in question occurred between the 2018/19 and 2020/21 financial years.
It relates to the controversial and lucrative “Contract 13B”, which involved the supply of construction machinery and equipment to the metro.
Yawa also recommended that a further R66.5m in irregular spending from the 2012/13 and 2013/14 financial years — under a similar contract 13 — also be written off, as the debts have prescribed.
However, after a heated debate, council members rejected Yawa’s proposal and referred the matter to the municipal public accounts committee (Mpac) for further scrutiny.
Contract 13B was declared invalid by the courts in October 2019 after complaints from service providers and procurement irregularities.
Despite this, city officials continued to use the contract until 2024.
The auditor-general flagged this as irregular expenditure, prompting an Mpac investigation.
Though the council resolved in October 2024 that the money should be recovered from senior officials who failed to prevent the irregular spending, Yawa says that is no longer possible.
In his report, Yawa acknowledged that his predecessor, Andile Sihlahla, which he did not mention by name, failed to act in time.
He also criticised the council for not holding Sihlahla, who could not be reached on Friday, accountable.
It is common cause that the accounting officers of the municipality did not consistently comply with the prescribed legal framework
“It is common cause that the accounting officers of the municipality did not consistently comply with the prescribed legal framework,” Yawa said.
“Similarly, the council did not consistently hold the accounting officer accountable. This has led to ongoing irregular expenditure.”
He warned that any attempt to recover the money now would be considered fruitless and wasteful, as both civil and disciplinary actions were time-barred.
“Even if we have grounds to act, if it is no longer legally possible, then any money spent pursuing recovery would be wasted,” he said.
“Such fruitless expenditure could then be claimed back from the council and Mpac members who authorised the action.”
Mpac chair and ANC councillor Sakhumzi Caga confirmed that Yawa’s report had been referred to his committee for review.
“We will discuss the recommendations from management in our next meeting on Wednesday,” he said. “I cannot pre-empt the outcome.”
Some councillors supported Yawa’s recommendations, while others were strongly opposed.
DA councillor Anathi Majeke, who also serves on Mpac, welcomed Yawa’s recognition that previous leadership had failed.
“He is correct that disciplinary action is no longer feasible due to staff departures and the passage of time,” she said.
“But consequence management is more than disciplinary action. It includes training and improving systems, and that can still happen.”
She also raised concerns about a lack of progress on newer cases.
“It’s worrying that irregular expenditure for the 2023/24 financial year hasn’t yet been submitted to Mpac. That points to deeper problems.”
Majeke said identifying the officials involved would still be useful, even if no legal action could be taken.
She stressed that only Mpac had the authority to recommend whether the spending should be written off.
“For council to write off R632m, it must first receive a recommendation from Mpac. That’s why referring the report back to us is the correct step,” she said.
EFF councillor Mziyanda Hlekiso, also a member of Mpac, expressed frustration regarding BCM management’s failure to attend committee meetings.
“Management was supposed to present the report to us last Thursday, but they didn’t show up,” he said. “This makes it hard for us to do our oversight work.”
Hlekiso opposed a blanket write-off.
“Some of the people responsible are still employed by the municipality — we believe money should be recovered from them,” he said.
“For those who have left, we think criminal charges should be laid so that recovery can still be pursued.
“Writing everything off without proper investigation is unacceptable.”
Daily Dispatch
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