Johannesburg mayor Dada Morero has announced the establishment of a disciplinary board tasked with investigating financial misconduct and unauthorised, irregular, fruitless and wasteful expenditure (UIFWE).
This follows the scathing letter sent by finance minister Enoch Godongwana two weeks ago to the municipality. He told the mayor to respond with a comprehensive plan on how he plans to clamp down on UIFWE and enforce consequence management.
Godongwana detailed how in the 2024 financial year the municipality racked up:
- R1.4bn in unauthorised expenditure;
- R22bn in irregular expenditure; and
- R705m in fruitless and wasteful expenditure.
He told Morero the metro, which has an annual budget of R89bn, had taken “little to no action” to address these problems.
Morero has vowed to operationalise the city’s disciplinary board to bolster its efforts to address the minister’s concerns and take action against those responsible for the precarious financial situation.
He said the city’s July 31 council meeting approved 12 additional matters for preliminary investigation by the disciplinary board, amounting to R2.5bn.
“These matters pertain to alleged acts of financial misconduct and historical unresolved UIFWE issues that will lead to consequence management. The disciplinary board has concluded preliminary investigations on six matters totalling R535m.”
The disciplinary board is expected to report on its progress and outcomes at the city’s next ordinary council meeting.
Morero said most of the unauthorised expenditure is due to the bulk purchases of electricity and water that exceeded the approved budget.
“These bulk purchases are primarily driven by the consumption of these services by residents with technical and non-technical losses that occur during service delivery. The irregular expenditure is mainly due to the city acquiring goods and services without fully complying with supply chain regulations.”
Morero said noncompliance leading to irregular or unauthorised expenditure does not imply the city did not receive the services or goods purchased, but it indicates there was noncompliance in the procurement process.
The mayor vowed to act against further noncompliance findings by introducing a UIFWE strategy which is said to focus on timely investigations, consequence management and the regularising of noncompliant expenditure as outlined by the Municipal Finance Management Act (MFMA).
“To improve the city’s financial position, decisive actions were required. I have re-established and operationalised the disciplinary board in accordance with the MFMA regulations for financial misconduct procedures and criminal proceedings,” he said.
Morero said the war room he established on the city’s finances meets weekly to oversee the city’s purse.
“The war room is focusing on monitoring progress on implementation of the city’s turnaround strategy I announced during the 2025 state of the city address. This initiative is yielding positive results, bringing us closer to achieving a sustainable minimum average revenue collection of R200m a day.”
The mayor said the revenue collection improvement is visible from actions taken through the war room. The city’s collection performance in July demonstrates the minimum average daily collection of R200m is achievable.
“The city's collection rate for April to June is 87%, representing a 2.7% increase from the 85% rate recorded during the same period last year.”
Morero conceded the concerns raised by Godongwana are significant, but he believes they are inherited from the previous administration.
“Our city has endured a period of mismanagement and poor leadership from previous administrations, particularly during the DA-led coalition. The R23.6bn in unauthorised, irregular and fruitless expenditure is a cumulative figure that has progressively increased in the city’s financial statements over the years.”
According to Morero, during the DA-led coalition expenditures were largely unaddressed and not regularised as required by the MFMA.
He said the R23.6bn comprises:
- R13bn (55%) in unauthorised expenditure;
- R9.9bn (42%) in irregular expenditure; and
- R735m (3%) in fruitless and wasteful expenditure.
TimesLIVE
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