Warning: Minister of Cooperative Governance and Traditional Affairs Thembisile Nkadimeng. (Supplied)
Msunduzi ratepayers have asked the treasury for a forensic investigation into the municipality and for lifestyle audits of senior officials amid allegations that millions of rands were looted from its coffers ahead of last week’s election.
The chair of the Msunduzi Association of Residents, Ratepayers and Civics, Anthony Waldhausen, raised the alarm regarding new allegations that more than R5 million has been looted from the municipality in a letter to the treasury on 3 June.
The letter was also sent to Cooperative Governance and Traditional Affairs Minister Thembisile Nkadimeng and to and to her provincial counterpart, MEC Bongi Sithole-Moloi.
The association had written to Nkadimeng on 6 March, and to Sithole-Moloi on 13 May, regarding other allegations of corruption. The association alleged that the municipality was using municipal imbizo as electioneering platforms for the ANC rather than to discuss the city’s draft final budget and integrated development plan with residents and ratepayers.
The municipality has denied this.
Waldausen wrote on 3 June: “It has been brought to our attention of large-scale misappropriation of municipal funds by certain individuals at the Msunduzi municipality. We have evidence of social media posts [allegedly] by the Msunduzi Finance Unit of allegations of a looting spree by certain individuals at the municipality which is highlighted below.
“It was also alleged that senior managers were summoned to the ANC regional offices on 24 May 2024 by the regional secretary and told ‘to cough up R5 million or resign’. As a result of this cash [allegedly] left the municipality on 28 May 2024. We call on the national treasury to do the right thing and to urgently investigate these allegations speedily as it is your constitutional obligation to do so,” he continued.
“We also are asking what the Msunduzi Finance Unit have been asking — why is the acting municipal manager allowing the theft of municipal funds under his watch? Why is Cogta [the cooperative governance and traditional affairs department] turning a blind eye to all the Msunduzi financial mismanagement and malfeasance?
“All stakeholders in the Msunduzi municipality are finding it frustrating at the poor service delivery and the total collapse of the municipality at all levels. We just cannot continue with the status quo and there needs to be a full investigation into Msunduzi municipality as a matter of urgency.”
The beleaguered municipality, which was under administration from 2019 until early May 2024, is now under a Municipal Systems Act section 139 1 (b) intervention that requires the municipality to be run by liaising directly with KwaZulu-Natal’s cooperative governance department.
But the ratepayers association said no action had been taken to deal with their repeated complaints of corruption.
Sources close to the municipality, who asked not to be named for fear of reprisals, alleged that the “looting” took place ahead of the elections after a meeting at the ANC’s KwaZulu-Natal regional office, during which officials were apparently urged by party representatives to come up with R5 million or face the prospect of losing their jobs.
But ANC KwaZulu-Natal spokesperson Mafika Ndebele denied the allegations, which are circulating on WhatsApp, saying the party is opposed to corruption and the claim had not been reported to it.
“What I can tell you is that in this period everyone wants to say whatever they want to say; the ANC has not received that information. We receive information and process it accordingly, and then we respond to what we know for now. We cannot respond to what we don’t know,” Ndebele said.
“We are extremely against corruption. Should there be that …we will act firmly but allow us to follow our processes. For now, there is no such thing on our desk.”
The messages circulating on social media are purported to have been sent by the Msunduzi Finance Unit and suspended municipal manager, Lulamile Mapholoba, but he this week denied that he had sent the messages.
Msunduzi ratepayers and civic association chairperson, Anthony Waldhausen. (Supplied)
According to the message on social media: “The last scoop of the looting of Msunduzi resources has been discovered in the last two weeks by the Finance Team. Msunduzi has embezzled R30 million in the past two weeks. This was done in pursuit of the rehabilitation programme of our road infrastructure in Prince Alfred Road and some few pockets in some few wards.”
The message further alleged that R5 million had been looted and spent at the Golden Horse Casino in Scottsville where a student party had apparently been held on the evening of the elections.
Mapholoba recently won a labour court ruling setting aside his unlawful precautionary suspension but municipal officials barred him from returning work last month. He said he has now filed a contempt of court application against the municipality.
Mapholoba’s precautionary suspension in February related to various allegations including that he had attempted to centralise the investigative powers of the city’s Forensic Investigation Unit.
One source, who spoke on condition of anonymity, said he had been told that senior leaders of the municipality, as highlighted in the messages on social media, had been called to a meeting at the ANC’s provincial office and told to pay R5 million or lose their jobs.
Asked about the allegations in the messages, the source alleged that officials had been “syphoning the municipality”.
“Millions and millions of rands have left the municipality. They do it with impunity. They release money in the name of projects, projects that are not on the ground,” he said.
“Msunduzi is being looted in broad daylight.”
The source said the council had passed a resolution on Tuesday to pay for a funeral of a former mayor that is taking place in Johannesburg.
But, he said, the resolution did not contain a cost estimation for the funeral which made it “a blank cheque, you can spend as much as you like”.
The Msunduzi association also raised this issue in its letter to the treasury.
Another source, who also asked not to be named, said he was aware of the allegations that millions of rands had been embezzled from the municipality and an investigation was now required to prove it.
Ross Strachan, the Msunduzi municipality Democratic Alliance (DA) councillor, said the party had reported earlier allegations of corruption to the Special Investigating Unit (SIU), and was also in the process of submitting these latest allegations to it.
“The DA has been in ongoing contact with the SIU for various allegations of corruption, financial misconduct and political interference from senior politicians within the ANC locally,” Strachan said.
“The SIU has responded positively and Msunduzi [municipality] has been on the radar for some time now.
“These allegations are also being submitted to the SIU for investigation and the call for an urgent deployment of the SIU is imminent. All allegations must be immediately addressed and those found guilty must be charged.”
Rienys Niemand, the Msunduzi African Christian Democratic Party councillor, said he was aware of the allegations of corruption and said an investigation into the matter was necessary.
He warned that the municipality — which owes Eskom and Umngeni Water R1 billion that it must repay over the next five years in terms of its payment arrangement with the state power utility — “is in a state of bankruptcy”.
Niemand said 30% of the municipality’s electricity is stolen by residents through illegal connections and non-payment for services, and paying residents are now facing electricity and water price hikes of 17% and 12% in 2024-25 to fund the municipality’s budget.
He said the municipality is 176 days behind in paying its creditors, which should be paid within 30 days in terms of government policy.
By the time of publication the treasury, Nkadimeng, Sithole-Moloi and the Msunduzi municipality had not responded to the Mail & Guardian’s questions regarding the allegations and the call for a forensic investigation.