POLOKWANE – The DA in Polokwane has raised red flags after the Polokwane Municipality’s R41m reimbursement to a private developer.

The refund made was allegedly for bulk services at Ivy Park Extension 36, also known as Ivy Royal Manor.

According to DA councillor in the municipality, Jacques Joubert, leaked documentation received by the DA confirms that despite a clear service agreement placing the responsibility for connecting infrastructure on the developer’s part, the municipality refunded a substantial portion of the R46m initially paid by the developer in 2023.

The DA demands immediate clarity on the justification of this payment and insists on a full disclosure of the budget line item and vote that was utilised to facilitate this refund.

Joubert claims that, during the 2024/25 draft budget engagements, the DA already flagged an allocation of R9.4m under the capital budget labelled ‘Ivy Royal Manor’, which appeared to represent the outstanding balance owed to the developer.

“Alarmingly, once we raised our concerns, this allocation was suddenly removed from the budget tabled to council. The DA is now calling for a detailed report to be tabled before council without delay. Should the report confirm any wrongdoing or irregularities, we will push for a comprehensive and independent investigation and consider any further relevant steps,” Joubert concluded.

According to spokesperson for the municipality, Thipa Selala, the reimbursement was executed in line with applicable legislation, formal development approvals and a legally binding engineering services agreement.

“The transaction was neither irregular nor inexplicable, but rather consistent with practices that are permissible under national and municipal regulatory frameworks,” Selala stated.

Selala explained that the reimbursement in question was guided by the Spatial Planning and Land Use Management Act (Spluma), the municipality’s Spluma by-law and other relevant town planning instruments.

These frameworks allow for negotiated agreements with developers where infrastructure installed supports broader municipal development and meets the statutory and service delivery requirements.

“Not all developers are automatically reimbursed for bulk service installations. Each application is assessed on its individual merit, including compliance with town planning conditions, service delivery priorities and alignment with council-approved spatial plans. Where bulk infrastructure is deemed to benefit the wider community and future growth of the city, formal agreements allow for the possibility of compensation,” Selala added.

Selala went further to say that the payment was made following proper processes as provided for in the Municipal Finance Management Act (MFMA) and Supply Chain Management (SCM) regulations.

These include a duly approved land use application, development conditions adopted by council, a legally binding engineering services agreement and finally alignment with development frameworks and spatial priorities.

“Where applicable, any deviations from standard SCM procedures are subjected to strict internal controls, justification and approval in terms of Section 36 of the SCM Regulations. All such deviations are transparently reported and audited through the established council oversight structures,” Selala said and added that the reference to an earlier budget item related to Ivy Royal Manor during the 2024/25 budget engagements should not be misconstrued.

“Budget line items are frequently adjusted as planning is refined and funding strategies evolve. The adjustment in question was an administrative correction that formed part of the normal budget review and approval process,” he concluded.