Parliament, Thursday, 7 May 2026 – The Portfolio Committee on Cooperative Governance and Traditional Affairs this week again raised serious concern about poor financial and contract management in the Nelson Mandela Bay Metropolitan Municipality and warned that this is affecting residents who need basic services.
The committee considered several governance, financial management and service delivery issues. These include so-called “evergreen contracts” (long-running contract extensions without a competitive bidding process); millions in withheld grant funding; the bucket toilet eradication programme and billions in unauthorised, irregular, fruitless and wasteful expenditure.
Members expressed frustration and rejected the municipality’s explanations of its handling of these evergreen contracts. The committee was dissatisfied with the lack of detail provided on the contracts, some of which had been extended for more than 10 years. Members noted that the contracts pointed to serious failures in contract management and a lack of financial controls.
The Chairperson of the committee, Dr Zweli Mkhize, noted that there were likely irregularities in several contracts, as the municipality’s own documents showed that some officials were not convinced by the reasons given for the cancellation of certain procurement processes. He said the committee would refer the matter to the National Treasury and the Department of COGTA for investigation and request a report within a month. The municipality was given one week to provide the missing information on the full contract values, reasons for extensions, deviations, responsible officials, losses, penalties and consequence management steps. The Chairperson warned the municipal leadership to ensure that the submitted information is accurate and that they take responsibility for all submissions; otherwise, the committee has the discretion to call them back to account for inaccuracies.
Another matter that drew the ire of committee members was the millions in withheld grant funding that could have been used to deliver services and housing. The committee noted that National Treasury notified the municipality of its intention to withhold R26.1 million from the 2025/26 Informal Settlements Upgrading Partnership Grant allocation, R125.9 million from the Urban Settlements Development Grant allocation and R126 million from its 2025/26 Regional Bulk Infrastructure Grant allocation in terms of section 18 of the 2025 Division of Revenue Act. The withheld grant funding covered human settlements projects, infrastructure, engineering, electricity, energy and other important areas that, if spent correctly, could materially improve the living conditions of many residents.
Members noted that residents ultimately bear the cost when funds meant for service delivery are not spent because of poor planning, weak monitoring and underperformance. “We cannot have communities facing poor sanitation, sewer spillages, water challenges and inadequate housing while available funds are not spent,” the Chairperson said. He said the municipality must ensure that it retains and spends the grants allocated to it.
On the bucket toilet eradication programme, the committee noted that thousands of households still rely on bucket systems and requested a written progress report outlining how the municipality would eradicate the remaining approximately 4 000 buckets and by when.
The committee also raised concerns about R1.7 billion in irregular expenditure that the Municipal Public Accounts Committee (MPAC) has reportedly processed for write-off. The committee instructed the municipality to submit the MPAC reports on these write-offs, the council minutes from the meetings at which they were considered, investigation records, recovery steps and importantly, disciplinary and criminal referrals. “We need the report that explains each and every amount,” said the Chairperson.
The committee said the municipality must return with complete and accurate information and warned that municipal leaders remain accountable for the submissions made to Parliament.
ISSUED BY THE PARLIAMENTARY COMMUNICATION SERVICES ON BEHALF OF THE CHAIRPERSON OF THE PORTFOLIO COMMITTEE ON COOPERATIVE GOVERNANCE AND TRADITIONAL AFFAIRS, DR ZWELI MKHIZE.
For media inquiries or interviews with the Chairperson, please contact the Media Officer:
Name: Alicestine October
Cell: 083 665 4345
E-mail: aoctober@parliament.gov.za
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