The Portfolio Committee on Co-operative Governance & Traditional Affairs (CoGTA) has escalated a controversial R137-million water maintenance tender at uThukela District Municipality to National Treasury for investigation. The move comes after a meeting with municipal leadership to assess progress following oversight visits earlier this year.

Unfunded budget raises alarm

In a media statement issued today (March 18), the committee heard that uThukela is operating with an unfunded budget and severe financial instability, with projections indicating that recovery may only be achieved by the 2029/30 financial year. This has left the municipality struggling to pay service providers and employees, raising possible violations of the Municipal Finance Management Act (MFMA).

Committee chairperson Dr Zweli Mkhize described the situation as a serious failure of financial governance.

R137-million tender in the spotlight

Parliament stated that at the centre of the concerns is the R137-million tender, awarded through an unsolicited bid for water infrastructure maintenance. The contract, dating back to 2016-2021, is currently the subject of a dispute before the Pietermaritzburg High Court.

Members flagged unclear contract terms, lack of oversight, and questionable invoices linked to the project.

Treasury probe

The committee also raised concerns about the use of third-party bank accounts and questionable borrowing practices, warning that these could breach financial laws and expose officials to liability.

National Treasury is now expected to lead an investigation, while the municipality has been instructed to submit detailed financial reports within three weeks and a full recovery plan within three months.

The committee also indicated that the matter could be referred to the Auditor-General as it continues oversight at Inkosi Langalibalele Local Municipality.

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