The Eastern Cape education department is facing severe criticism and potential financial penalties after diverting millions intended for school infrastructure projects to two unauthorised Information and Communication Technology (ICT) initiatives.
The national department of basic education (DBE) threatened to withhold more than R529m until the money wrongly spent was refunded for desperately needed infrastructure.
The national government’s threat was laid bare in two confidential letters, seen by the Daily Dispatch, from DBE and the Eastern Cape treasury.
The letters criticised the provincial education department for spending money “outside the stipulations of the Division of Revenue Act”.
The Eastern Cape department spent R247.6m on two ICT contracts. This is the equivalent of 13% of its education infrastructure grant budget of R1.9bn.
These funds were used for a server and local area network infrastructure upgrade and for “ICT support” for rural schools in the province.
Basic education department director-general Matanzima Mweli wrote to Sharon Maasdorp, the provincial education department’s administration head, saying that of the R247.6m, R147.7m of the grant funds had been wrongly spent, while a commitment had been made to spend a further R100m.
Mweli said in February 2022, the provincial education department wrote to the provincial treasury requesting “concurrence” to use the grant money to buy “connectivity infrastructure” which at that stage it was leasing.
The provincial treasury supported the request but said the department should raise the matter with DBE.
This led to various meetings, including with the National Treasury.
But the Treasury rejected the idea of using the grant funds for the ICT initiatives, and the province’s request was declined.
On Tuesday, basic education department spokesperson Lukhanyo Vangqa said the decision to withhold the province’s grant funding “is important for good governance”.
“The DBE has a responsibility to ensure that public funds are used for the purposes for which they were allocated.
“In this case, the department is simply enforcing compliance in accordance with the Division of Revenue Act, 2025.”
In his correspondence to the provincial education department, dated November 13, provincial treasury administration boss Daluhlanga Majeke urged the department to stop the unauthorised use of the grant money.
Majeke said the two “questionable” ICT projects were not even part of the department’s tabled 2025 project list, “and as such, this is deemed as unauthorised expenditure”.
Majeke said the provincial treasury would soon conduct oversight visits “to verify physically the value created on the ground” in respect of the ICT projects.
He urged the department to “journalise” the incurred expenditure in the amount of R147.6m for the two projects, “and fund it using the equitable share, and to decommit the R100m committed funds immediately”.
“The implications of non-adherence to the above will have disastrous consequences for the department’s infrastructure delivery portfolio, which is currently overcommitted, as evidenced by reports made through the infrastructure governance structures.”
Majeke said the greatest impact would be “felt by contractors on the ground and will be disastrous for SMME continuity”.
To make matters worse, while the department splurged on projects that were never approved, infrastructure development spent R1.152bn, or 97.9%, of its projected mid-year budget, yet still failed to deliver actual infrastructure, underspending by R24.564m in the first two quarters.
— DA MPL Horatio Hendricks
On Tuesday, education MEC Fundile Gade acknowledged receipt of Majeke’s letter, basically describing it as routine correspondence between government departments aimed at ensuring accountability.
Gade said he had since approached the provincial treasury to help investigate the use of the grant funds for ICT projects.
A number of government insiders confirmed on Tuesday that the irregular use of the funds had created “some serious tensions” between Gade and his head of department, Maasdorp.
Gade refused to comment on this, while Maasdorp could not be reached for comment.
It is understood that a senior Eastern Cape education official was suspended recently after allegedly refusing to sign off on the two ICT projects.
The official could not be reached for comment this week but is understood to have taken the matter to court.
Gade is said to have distanced himself from the suspension of the official.
ANC Eastern Cape spokesperson Yanga Zicina refused to comment on the national department’s threats to withhold grant funding.
“In fact, at this stage, this should rather go to the department as it is still inconclusive.
“I’m sure the department would like to write back to the national department and explain certain things …
“The ANC would then have a comment once the matter is concluded.”
DA MPL Horatio Hendricks said the party was “outraged, though unsurprised, by the latest evidence revealing systemic dereliction of duty and reckless financial mismanagement” at the education department.
“To make matters worse, while the department splurged on projects that were never approved, infrastructure development spent R1.152bn, or 97.9%, of its projected mid-year budget, yet still failed to deliver actual infrastructure, underspending by R24.564m in the first two quarters.
“This crisis is entirely self-inflicted [and] serves as a trend of habitual underperformance.
“For the 2024/2025 financial year, the department expended 99.9% of its budget while achieving only 10% of its [required] infrastructure targets.”
EFF MPL Simthembile Madikizela said though it was correct to investigate the misuse of public funds, “the decision by the DBE to withhold over R529m is misguided and harmful”.
“Withholding funds does not hold corrupt officials accountable, it punishes children and communities who rely on these projects for basic dignity, and who were hopeful that they too would taste the fruits of democracy …
“We interpret this approach as a short-term PR exercise rather than a genuine attempt to fix systemic failures.”
ATM spokesperson Zama Ntshona said the planned withholding of the grant funds was “a stark reminder of the incompetence that has marred educational governance in the province”.
“The DBE’s justification for withholding funds highlights a blatant disregard for the urgent infrastructural needs of our schools.
“Instead of prioritising the allocation of resources to address these pressing issues, the province has diverted funds to unauthorised projects, demonstrating a shocking lack of efficiency, effectiveness and political will.
“This mismanagement perpetuates a cycle of failure that directly impacts the learning environment, leaving thousands of learners stranded in substandard conditions, with many facing the prospect of dropping out due to the intolerable circumstances.”
Daily Dispatch
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