‘War on Leaks’ programme: SIU reveals R2.2bn budget balloons to over R4bn

The Special Investigating Unit (SIU) has revealed that the budget for the War on Leaks programme has increased to more than double the initial plan, and the number is still rising.

The SIU appeared before the Standing Committee on Public Accounts on Wednesday, where it provided an update on its investigations into the Department of Water and Sanitation.

According to the SIU, the department is riddled with:

• Contracts that balloon from the initial budget
• Irregular appointments of service providers
• Contractors who fail to perform contractual duties
• Irregular contract extensions
• Procurement irregularities
• Possible fraudulent claims
• Overpriced goods and services
• Payment for work never performed
• Manipulation of the payment system for overpayment and incorrect VAT charges
• Officials in the water sector who certified and commissioned work that was not performed
• Irregular expenditure

In April last year, President Cyril Ramaphosa signed Proclamation 164 of 2024, authorising the SIU to investigate allegations of serious maladministration in the department and to recover any financial losses suffered by the state or the department.

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The scope of the investigation covers any unlawful or improper conduct by department officials or employees, as well as applicable suppliers or service providers, or any other person or entity that has caused or may cause serious harm to the public’s interests.

‘War on Leaks’

The War on Leaks Artisan Training programme was launched by then-president Jacob Zuma in 2015 with the aim of training 15,000 youths to reduce water losses through leaks.

The project was signed in 2015 by then Water and Sanitation Minister Nomvula Mokonyane for Rand Water to curb about R7 billion in water leaks across the country.

During Phase one of the project, 3 000 pupils were trained during 2015/2016, during Phase two, 5,000 pupils were trained during 2016/2017, while in Phase three, 7,000 pupils were set to be trained during 2017/2018.

The second phase of the War on Leaks project was launched by Mokonyane in Durban in February 2017.

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The approved budget for the programme was R2.2 billion. However, the SIU identified that R4.7 billion had been paid out so far, the SIU told the committee on Wednesday.

The SIU said this number continues to increase due to its forensic account quantification process.

Rand Water received R1.7 billion, which includes R40 million in unexplained and unsubstantiated contingency fees. This investigation is ongoing.

SIU on Rooiwal Wastewater Treatment Works 

Rooiwal made headlines in 2023 after a cholera outbreak which killed 23 people at Hammanskraal, with controversial businessman Edwin Sodi’s R295-million tender contract to upgrade the plant’s infrastructure being scrutinised.

At the time, the department found that “the failure of the Rooiwal Wastewater Treatment Works to meet the desirable final effluent quality for discharge to the Apies River, which in turn flows into the Leeukraal Dam”, played a critical role in the Hammanskraal water crisis.

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The SIU has since been investigating the refurbishment and upgrade project, of which only 60% of the first phase was completed before it was abandoned in 2020. 

In this project, the SIU identified 65 role players for high-level profiling, including officials, private individuals and entities.

Nine officials were flagged for further lifestyle audits due to assets purchased and indications that they were living beyond their means.

The SIU said that 27 officials were also flagged for further lifestyle audits due to assets purchased or living beyond their means, as well as suspicious transactions.

Since 2012, the department’s cash and assets yet to be recovered amount to R264.1 million, while the actual cash or assets recovered amount to R569.1 million.

The department’s contracts or administrative decisions that were set aside or deemed invalid amount to R1.1 billion. The SIU prevented a potential loss of R717 million.

From 2008, the SIU has received 14 proclamations relating to the water and sanitation sector.

Investigations into nine of these proclamations have been finalised, while five are active.

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