Middelburg is one of 12 Mpumalanga municipalities ordered by the MEC for Co-operative Governance, Mr Mandla Msibi, to comply with the Zondo commission’s request for audited annual financial statements including the Audit General (AG), and external auditors’ management reports thereon, a schedule detailing the various matters that make up irregular expenditure contained in the annual financial statements, a list of all payments made, copies of all forensic and investigation reports finalised or in draft, all internal audit reports, a list of matters reported via the municipality’s corruption hotline, as well as a list of the municipality’s 20 top suppliers by value per year.

The other municipalities include Piet Retief, Lydenburg, Carolina, Balfour, Siyabuswa, Volksrust, Ermelo, Standerton, KwaMhlanga and Delmas.

MEC Msibi’s directive to the implicated municipalities was issued after a second written request for assistance from the Zondo commission’s Secretary Ms Brigitte Shabalala.

Her request for the MEC’s intervention was sent according to a courtesy letter, informing the MEC of the commission’s investigation into irregularities on 28 June.
All named municipalities were ordered by MEC Msibi to submit the necessary information to the commission on August 29.

The AG reported that municipalities lost around R2.2 billion in irregular expenditure, of which 99.98% in expenditure was caused by dodgy procurement and contract management.

In 2017/2018 Steve Tshwete Municipality received an unqualified audit with matters of emphasis on budget under-spending to the tune of R78 million.
The AG also found material impairment of trade debtors amounting to more than R100 million, representing 52% of the total receivables.

Also read: ‘Gupta’ is a swear-word in Middelburg

The municipality was further criticized for its procurement and contract management, with the AG reporting that some of the bid documentation of commodities designated for local content and production did not stipulate the minimum threshold, and similar non-compliance was also reported the previous year.

The AG found that management did not perform adequate reviews of the annual financial statements under review, and that management also did not monitor compliance with laws and regulations.

Municipal Manager Mr Bheki Khenisa says that the municipality fully complied with the Zondo commission’s request for information.

Mr Khenisa believes that the commission requested information because of the contracts entered into with Optimum Mine for the provision of water to Hendrina and Kwazamokuhle.

The municipality, however, later directly paid Proxa, Optimum’s water purification service providers at the Pullenshope purification plant, after Optimum withheld payments for water to the contractor.

“I’m sure the commission wants to see for itself whether there were any irregularities with the Optimum contract, because the Gupta owned mine remains at the heart of the state capture inquiry,” Mr Khenisa says.