A water-sector anti-corruption forum has called for political parties to sign a public ethics pledge on clean procurement and accountable governance, raising the stakes around water and sanitation failures ahead of the November 4 local government elections.

The proposal emerged from a high-level roundtable convened by WaterCAN, the Special Investigating Unit (SIU) and the Water Integrity Network (WIN) this week, as corruption, infrastructure collapse and weak municipal governance deepen public anger over failing basic services.

“Accountability cannot rest with oversight institutions alone,” said Dr Ferrial Adam, of WaterCAN. “Communities, civil society, business and ethical public servants must be brought much closer to the systems where decisions are made, and money is spent.”

The roundtable brought together representatives from civil society, academia and business, as well as senior officials from the Department of Water and Sanitation, the SIU, the Auditor-General of South Africa and the Department of Cooperative Governance and Traditional Affairs.

It was held against the backdrop of the newly established Water Sector Anti-Corruption Forum, a sector-specific platform intended to tackle corruption in the water sector through a “whole of society” approach.

Participants said corruption in water and sanitation should not be treated only as a law-enforcement problem, but must also be tackled through prevention, ethical procurement, public oversight, whistleblower protection and pressure from communities, civil society and business.

A central focus of the meeting was the need to improve oversight across the full procurement cycle, including the pre-procurement, procurement and post-procurement phases, where corruption risks often emerge.

Participants proposed procurement and service-delivery social audits, drawing on existing research by institutions including the Public Affairs Research Institute, as a practical mechanism for community and civil society oversight.

The forum also warned that policy developments, including the Local Government White Paper and procurement reforms, should be closely monitored to ensure they do not weaken transparency, accountability or consequence-management mechanisms.

The business sector committed to taking a more visible role in promoting ethical conduct and transparency in the water value chain, with the forum proposing a dedicated business roundtable to strengthen private-sector participation in anti-corruption work.

Other proposed steps include expanding the stakeholder platform to include more civil society organisations, professional bodies, researchers and community structures, as well as small-town pilot projects, localised roundtables, stronger whistleblower protection and public education campaigns.

WaterCAN, WIN, the SIU and participating stakeholders will now develop a civil society and business action plan focused on prevention, oversight and accountability in the water and sanitation sectors.

The plan is expected to include awareness and capacity-building work to help communities, researchers, civil society organisations, professional bodies and businesses monitor procurement, identify corruption risks and participate more effectively in oversight processes.

Stakeholders also committed to working with the Water Sector Anti-Corruption Forum’s Prevention Committee to feed the roundtable’s recommendations into wider anti-corruption initiatives in the sector.

Participants said the forum would explore a public ethics and anti-corruption pledge for political parties, calling on them to commit to transparent governance, ethical leadership, clean procurement and decisive action against corruption in water and sanitation.

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The Special Tribunal has set aside an R85 million KwaZulu-Natal-Mozambique border wall tender after finding that the ISF Shula Joint Venture used a fraudulent B-BBEE certificate, submitted an expired Letter of Good Standing, and failed to meet mandatory financial capacity requirements.

The wall was commissioned by the KwaZulu-Natal Department of Transport “in response to community concerns about rampant cross-border crime, particularly the smuggling and trafficking of stolen and hijacked vehicles into Mozambique,” the Special Investigating Unit (SIU) said in a statement on Friday.

In July 2016, the community of uMkhanyakude in KZN protested about rampant crime in the area. On 29 March 2018, the department published an invitation to tender for the construction of an 8km concrete barrier wall between uMkhanyakude and Mozambique.

A total of 14 bids were submitted. Six were found to be unresponsive, the majority because they did not meet the requirement that the tenderer must have a B-BBEE Level 1 status.

The ISF Shula JV bid was one of three that progressed to evaluation on price and preference points. The tender was approved on 12 July 2018 and the contract concluded on 16 August 2018.

“Instead of delivering on this urgent public safety measure, the Joint Venture submitted fraudulent documents, failed to meet mandatory requirements, and left the project incomplete despite receiving R84 million,” the SIU said.

Only 5.29km of the wall was erected, with 2.71km still outstanding, forcing the department to issue another tender worth R62,288,559 for completion of the work in June 2023, nearly five years after the original contract was concluded.

In its judgment, the Tribunal said the department had stated in an explanatory affidavit that, on average, 74.7% of the work had been done before the contract was cancelled.

The Tribunal also found that the B-BBEE certificate submitted by the joint venture was false, and the fraud was extensive.

The ISF Shula JV provided a consolidated Joint Venture B-BBEE certificate, dated 1 December 2017, purportedly issued by verification agency Inforcomm.

However, the Chief Executive Officer of Inforcomm provided a sworn statement confirming that Inforcomm did not issue the certificate.

The certificate showed a 50/50 ownership split between ISF and Shula, which was inconsistent with the JV Agreement submitted as part of the bid — that agreement recorded ISF as holding a 70% share and Shula 30%.

The certificate was issued under the 2007 B-BBEE Codes of Good Practice, which had been repealed and replaced by the 2013 Codes from 1 May 2015.

The certificate claimed the ISF Shula JV had a Level 1 B-BBEE contributor status with a score of 80 points, but under the 2007 Codes, 80 points equated to a Level Three contributor, and under the 2013 Codes, a Level Four.

“Under both the 2007 and the 2013 Codes the ISF Shula JV could never achieve a Level 1 B-BBEE contributor status,” Tribunal Judge Chantel Fortuin said in the ruling.

Neither ISF nor Shula seriously disputed the certificate was false. Both companies shifted blame to an accountant, one Mr Budden, whom they had engaged to obtain the certificate.

“It is astonishing how the first and second respondents fail to take responsibility for this fraudulent B-BBEE certificate. This was a document in their names, submitted for a tender in their names and all the responsibility is shifted to a third party,” the judgment reads.

Fortuin said the attitude of deflecting all responsibility “persists throughout this application and will, as it should, be considered as one of the factors in determining an outcome”.

She said the invalid B-BBEE certificate was enough, on its own, to render the award unlawful.

“An invalid B-BBEE certificate amounts to no certificate being submitted. Consequently, I find that the award of the tender to the ISF Shula JV was unlawful because a falsified and invalid B-BBEE certificate was provided.”

The Tribunal also found that the Letter of Good Standing submitted for the tender was invalid.

All bidders were required to submit a valid Letter of Good Standing with the Compensation Commissioner, a mandatory tender requirement for both parties in a joint venture.

ISF submitted a letter issued on 7 May 2017. On ISF’s own version, that letter expired on 30 April 2018, before the contract was even concluded.

“In my view, the letter was indeed stale and invalid for the purposes of the tender. In effect, therefore no Letter of Good Standing was submitted by Shula,” said the judge.

Regarding financial capacity, the Tribunal found that the joint venture should not have passed the functionality threshold.

The tender required bidders to score at least 60% in a functionality assessment. In the Financial Capacity category, the JV was awarded six out of a possible 10 points, a score that required a Grade C credit rating, but the bid documents did not contain the necessary certified letters from both JV members’ banking institutions confirming their credit ratings.

Had the correct score of zero been applied to that category, the JV’s total functionality score would have fallen to 50%, below the mandatory 60% threshold.

On the Tribunal’s reasoning, the JV’s bid should not have survived the first stage of evaluation.

The joint venture was, in Judge Fortuin’s words, “a sham”.

Shula stated in its answering affidavit that it was part of the ISF Shula JV “in name only” and that it never intended to conduct any work or otherwise participate in the project for which the tender was awarded.

ISF and Shula had formed the JV in order to increase their Construction Industry Development Board rating, which allowed them to tender for projects of higher value.

“The two companies planned to, after winning the tender, split back into individual companies and work on their respective projects,” the judge said.

This was further evidenced by a new JV agreement entered into on 9 April 2019 — after the tender was already awarded — which made explicit that for the border wall contract, Shula would attend to all the work as a subcontractor of the joint venture, with any profits or losses accruing solely to Shula’s benefit.

However, because this fourth ground of review had only been raised by the SIU in its heads of argument and not in its founding papers, Judge Fortuin made no formal finding on it, noting that “one or more of the remaining three grounds of review would amount to an unlawful contract to be reviewed and set aside” regardless.

The SIU had originally sought repayment of the full R84,346,497.86 paid to the JV.

The Tribunal declined to grant this primary relief, noting that approximately 74% of the work had in fact been performed.

Instead, the Tribunal ordered the alternative relief: that ISF and Shula disgorge only the profits derived from the contract.

Said Fortuin: [I]t is necessary for this tribunal in exercising its discretion to craft a just and equitable remedy to assess the blameworthiness of the first and second respondents and whether they should be entitled to the profits from the undisputed services it rendered to 74% of the building.”

As part of the order, ISF Shula Joint Venture has been directed to repay all profits it derived from the contract to the SIU.

The Tribunal further ordered the KZN Department of Transport and its head of department must start disciplinary proceedings within 30 days against officials who served on the Bid Evaluation Committee and had not yet been disciplined for their involvement in the tender award.

“This judgment validates the SIU’s investigation and sends a clear message that fraudulent certificates, misrepresentation, and incomplete delivery will not be rewarded,” the SIU said.

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The Special Investigating Unit says it is awaiting a presidential proclamation to formally investigate the controversial Beachfront Court Crescent project at the Buffalo City Metropolitan Municipality, as questions mount over value for money and procurement processes.

Briefing Parliament’s Standing Committee on Public Accounts on Tuesday, SIU Eastern Cape head of investigations Mike Koya confirmed that the beachfront matter has not yet moved into a full investigation phase.

ALSO READ: SIU flags pay-before-work pattern at OR Tambo, blames non-cooperation for delays

“The BCMDA one, the waterfront, we have not yet conducted an investigation. We are still at the stage of assessment,” Koya told MPs.

The project falls under the Buffalo City Metropolitan Development Agency and has been under scrutiny alongside the Water World Fun Park development.

Koya said the SIU engaged the Auditor-General of South Africa (AGSA) to conduct a performance audit to determine whether the projects delivered value for money.

“The AGSA requested that the SIU allow them an opportunity to conduct their Performance Audit to determine value for money on the projects,” Koya said. 

He added that the SIU is awaiting a material irregularity referral from the AG to support its motivation for a proclamation.

He told MPs that while both the beachfront and Water World matters were reported at the same time, progress on the beachfront had advanced further administratively.

“As much as the beachfront and the Water World were reported to us at the same time, we had moved with the beachfront. It was only that letter from the Premier that was standing,” Koya said.

ALSO READ: SIU flags pay-before-work pattern at OR Tambo, blames non-cooperation for delays

He explained that the required letter from the Premier, which supports the proclamation process, had been delayed for months.

“The letters were submitted to the Premier around July 2025, but by January the letters were not there,” he said.

According to Koya, the letter has since been received and the matter is now with the Department of Justice. 

“This beachfront is closer now to a proclamation. It is now sitting with the Department of Justice,” he told the committee.

Without a proclamation, the SIU does not have the authority to conduct a full investigation, subpoena documents, or make referrals.

Acting SIU head Leonard Lekgetho said the unit is exploring ways to strengthen its powers to access information earlier in the process. 

“We are busy looking at our legislation so that we can have the powers to subpoena for documents even before the proclamation is issued,” he said.

The SIU indicated that once the proclamation is signed, it will be able to investigate procurement processes, payments and any potential improper or unlawful conduct linked to the beachfront development.

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A R646 million contract intended to urgently upgrade KwaZulu-Natal’s Thukela–Goedertrouw water transfer scheme has been declared constitutionally invalid and set aside by the Special Tribunal, after it was found to have been awarded in violation of public procurement laws.

The ruling by the Special Tribunal comes after the Special Investigating Unit (SIU) launched an investigation into the Department of Water and Sanitation contract, which was initially budgeted at R407 million but ballooned to R646.5 million, generating irregular expenditure and substantial losses to the State.

ALSO READ: O’Sullivan on the defensive: five things that irked MPs

The Tribunal found that AECOM SA (Pty) Ltd, the company awarded the contract, was irregularly included in the closed tender process despite not being formally invited. The bid adjudication committee had recommended against AECOM’s appointment, but the Acting Director-General, Sfiso Mkhize, proceeded with the award regardless.

“This judgment reinforces that government procurement must be fair, equitable, transparent, competitive, and cost-effective,” the SIU said in a statement on Wednesday.

ALSO READ: O’Sullivan rejects spy claims, outlines background before Parliament committee

The investigation revealed that senior officials bypassed required procedures, contributing to unlawful procurement and substantial financial losses. Mkhize approved AECOM’s appointment despite clear procedural irregularities. 

Meanwhile, Zandile Makhathini, then Chief Director of Supply Chain Management, circumvented the competitive bid system and submitted approval requests directly to the Acting Director-General. 

Chief Financial Officer Mr Mpho Mofokeng also signed off on submissions despite being aware of the irregularities. Collectively, these officials failed to implement the necessary controls, in direct contravention of Section 45 of the Public Finance Management Act.

The Tribunal ordered AECOM to submit audited financial statements, invoices, and supporting documents within 30 days. The SIU will then determine the profits earned by AECOM, which the company must repay. 

ALSO READ: Civil society asks Ramaphosa to block murder-accused Solly Lechoenyo’s Special Forces promotion

Failure to comply could result in further proceedings before the Tribunal. AECOM has also been ordered to pay the SIU’s legal costs, including fees for two counsel.

The SIU, established under Proclamation R.28 of 2019, is empowered to investigate maladministration and irregularities, recover state losses, and refer evidence of criminal conduct to the National Prosecuting Authority (NPA).

“The ruling strengthens the principle of legality in public procurement and sends a clear message that wrongdoing by officials and service providers will not go unchecked,” the SIU said.

The Thukela–Goedertrouw scheme was a critical project aimed at ensuring water supply to the Richards Bay area.

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President Cyril Ramaphosa has authorised the Special Investigating Unit (SIU) to investigate allegations of serious maladministration at the IFP-led uMzinyathi District Municipality in northern KwaZulu-Natal.

According to the SIU, the proclamation empowers the unit to investigate matters relating to procurement and contracting, including the supply, installation, and maintenance of ground dual static tanks and fuel, as well as the lease and subsequent purchase of a generator for the Vants Drift Water Treatment Plant in Nquthu.

ALSO READ: Nkabinde inquiry delayed again as Batohi still seeking legal advice 

Signed last week, the proclamation instructs the SIU to investigate whether the contracts and related payments were conducted in a manner that was not fair, competitive, transparent, equitable or cost-effective, and whether there were any breaches of legislation, National Treasury regulations or the municipality’s own policies.

“The probe covers allegations that took place between 1 March 2020 and 21 November 2025, and any conduct before or after this period relevant to the investigation,” SIU spokesperson Kaizer Kganyago said. 

Last year, the Department of Co-operative Governance and Traditional Affairs (Cogta) also raised concerns about governance and financial management challenges within the municipality.  

Cogta had warned that weaknesses in supply chain management and oversight posed a risk to service delivery and the safeguarding of public funds, particularly in critical infrastructure projects such as water provision.

At the time, the department stressed that any allegations of wrongdoing required urgent investigation.

“Where there are indications of maladministration or misuse of public resources, these matters must be fully investigated and those responsible held to account,” Cogta had said.

ALSO READ: Magashule says delays drain financially as Free State asbestos graft trial postponed again

“The SIU is mandated to uncover the truth behind these allegations and to ensure accountability where public funds may have been misused,” Kganyago said. 

In addition to possible criminal referrals, the SIU is authorised to institute civil proceedings in the High Court or a Special Tribunal to recover financial losses suffered by the State, including funds paid for services that were not rendered.

“Should evidence of criminal conduct be identified, such matters will be referred to the National Prosecuting Authority for further action,” Kganyago said. 

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This follows her arrest on charges of alleged fraud and money laundering during her previous employment at the Umzimvubu Local Municipality.

Sibabalwe Mgangatho, currently out on bail, is accused of defrauding Umzimvubu of R2 million between 2013 and 2017 while serving as Account Expenditure Officer.

Alarmingly, she now holds the same position at Makana Local Municipality, according to the DA.

“I have formally written to the Municipal Manager, requesting that disciplinary action be taken against Ms Mgangatho, in accordance with the Labour Relations Act and the municipality’s Disciplinary Procedures Framework,” said Luvuyo Sizani, DA Makana caucus leader, on Monday.

Sizani said to safeguard the finances and the integrity of the municipality, Mngagatho must be placed under precautionary suspension while the municipality conducts a thorough investigation.

He said if the Municipal Manager does not act, the DA will request the Special Investigating Unit (SIU) to launch a formal investigation into this matter.

“This arrest underscores a disturbing and ever-growing trend: Makana Municipality has become a haven for corrupt officials from the former Transkei region, many of whom have faced investigations or been dismissed from their previous roles. It is clear that a lack of proper vetting, coupled with rampant nepotism, has allowed these individuals to infiltrate key positions, compromising the integrity of our local government,” said Sizani.

“With officials like this, the question looms: is the Makana Municipality’s purse safe?”

Sizani said ratepayers are rapidly losing confidence in the municipality’s ability to manage their rates and services.

He added that the revelation that an alleged fraudster holds a key position in the Budget and Treasury department will only exacerbate this erosion of trust.

“The DA will continue to fight for transparency, accountability, and consequence management – because our community deserves nothing less,” said Sizani.

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