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IOL News
2 days ago
- Politics
- IOL News
Thirst for Justice: Billions wasted as taps run dry
Residents resort to fetching water, pushing buckets home on trolleys due to the ongoing water shortage in their area. With the committee vowing to recall the DWS for a deeper probe into water boards, South Africa's water catastrophe has reached a breaking point. Image: Oupa Mokoena/Independent Newspapers THE water crisis in South Africa is not looming — it's already here, fueled by systemic failures, corruption, and a dangerous blame game between national and local government. This sinking reality dominated the Standing Committee on Public Accounts (Scopa) hearing, where the Department of Water and Sanitation (DWS) faced an intense interrogation over its financial mismanagement, R25 billion in unpaid municipal debts, and the collapse of basic service delivery. Minister Pemmy Majodina, making her debut Scopa appearance under the seventh administration, delivered a rather sobering admission: 'There is no crisis in bulk water supply — but at household level, the system is collapsing.' The root cause? A staggering 105 of the country's 144 municipalities are chronically underperforming, leaving millions without reliable water despite South Africa's dams operating at 98% capacity. The Minister was quick to deflect accountability, citing the constitutional division of powers. 'Whenever there's no water in a village, the DWS is blamed. But reticulation is a local government function,' she said. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. 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Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ Yet the data presented by her department painted a damning picture of the consequences: Municipalities owe water boards R25bn, pushing critical entities such as Amatola, Lepelle, and Vaal Central to the brink of insolvency. Meanwhile, the DWS achieved just 70% of its performance targets despite spending 99.8% of its R21.4bn budget — a disparity Deputy Minister David Mahlobo attributed to 'multi-year infrastructure projects'. Corruption remains a festering wound. Over the past five years, the Department investigated 446 misconduct allegations, with 326 substantiated. Cases have been referred to the Directorate for Priority Crime Investigation (DPCI – alias Hawks) and the SA Police Service (SAPS), but convictions remain elusive. The SIU's ongoing probes reveal even darker rot: R4.7bn squandered on the 'War on Leaks' programme, which deployed untrained youth to fix municipal leaks — a function outside the DWS's mandate. Another R17.9 million was paid to a consulting firm with 'no evidence of work performed', while 'water tanker mafias' sabotage infrastructure to profit from emergency contracts. The hearing turned incendiary when MK Party MP Khethukuthula Madlala confronted the DWS over its inertia. 'If the government waits for formal complaints while people are being shot, we've failed,' he said. Minister Majodina conceded the grim reality: communities are too terrified to report extortion and vandalism, fearing violent retaliation. 'We share the frustration, but our hands are tied,' she admitted, highlighting the limitations of a system that requires sworn affidavits to act against criminal networks. The Auditor-General's findings further eroded confidence. The DWS has received three consecutive unqualified audits with 'material misstatements', while 37 procurement deviations, including a water-saving campaign that ballooned to R4.4bn, double its budget, exposed glaring financial controls. The Water Trading Entity (WTE) is owed R18bn, with debtors now taking 573 days to pay, up from 451 days last year. The collapse of water boards emerged as a national security threat. While Rand Water and Umngeni were praised as 'world-class', entities like Amatola and Magalies are buckling under municipal debt and governance chaos. Vaal Central's potential failure would paralyse the Free State and Northern Cape. Court battles rage as defiant municipalities — some owing billions, 'take the DWS to court after receiving debt letters'. The DA's Peter Atkinson delivered a warning: 'At R12bn a year, it will take 40 years to fix water infrastructure.' The DWS's own estimates confirm R400bn is needed just for the worst-performing municipalities, excluding metros. While the Department touted public-private partnerships as a solution, Deputy Minister Mahlobo acknowledged a brutal truth: 'Investors won't touch bankrupt municipalities.' The EFF's Veronica Mente's closing remarks cut to the heart of the crisis. 'Thirty years into democracy, flushing a toilet is still a luxury,' she said, demanding that the DWS take over municipal water functions. 'This isn't just failure — it's betrayal.' As the hearing adjourned, Scopa Chairperson Sizwe Zibi fired a parting shot: 'It's still your problem to solve. I'm sorry.' With the committee vowing to recall the DWS for a deeper probe into water boards, South Africa's water catastrophe has reached a breaking point — and millions are left waiting for a government that cannot, or will not, act. Get the real story on the go: Follow the Sunday Independent on WhatsApp.
The Citizen
09-06-2025
- Business
- The Citizen
State capture allegations come back to haunt RAF acting CIO
While RAF CEO launches legal bid to overturn his own suspension. It is not certain that the RAF board realises that the primary purpose of the fund is to 'compensate victims timeously'. Picture: Shutterstock The Road Accident Fund (RAF) board placed its acting chief investment officer (CIO) Sefotle Modiba on precautionary suspension following allegations that parliament's Standing Committee on Public Accounts (Scopa) was given misinformation about Modiba's departure from the City of Johannesburg (CoJ). It has also emerged that RAF CEO Collins Letsoalo has lodged an urgent high court application to review and set aside last week's decision by the fund's board to suspend him with immediate effect for insubordination for defying a board instruction for him to attend a Scopa meeting on 28 May. Letsoalo is alleging the decision is unlawful, irrational, and unreasonable and is requesting the court to order his immediate reinstatement as RAF CEO. The application is scheduled to be heard next week. RAF board deputy chair Dr Nomonde Mabuya-Moloele confirmed to parliament's Portfolio Committee on Transport last week that the RAF board had recommended at a special meeting tonight to rescind a decision to place Letsoalo on special leave and to then place him on suspension. Mabuya-Moloele further confirmed that Modiba had been placed on precautionary suspension with full pay and benefits with immediate effect. This is due to concerns regarding Modiba's previous employment at the CoJ and other matters that are currently under investigation. ALSO READ: RAF CEO placed on special leave with full pay, as MPs grill fund Charges 'were dropped' say Modiba's attorneys Scopa member Patrick Atkinson of the DA said during last month's Scopa meeting that a letter was sent to the committee by Vuyo Manisi Inc Attorneys on behalf of Modiba stating that: The CoJ decided to withdraw all charges of misconduct against Modiba; There was a mutual separation agreement between the CoJ and Modiba; and All of what is stated in the letter is well documented and backed up by concrete evidence that their client, Modiba, did not leave the CoJ with any charges hanging over his head. Atkinson said the letter further stated that Modiba feels aggrieved because of comments made by Scopa chair Songezo Zibi on a matter that had already been finalised and is inaccurate. He said the letter urged Scopa to refrain from 'using false information' and committee members not 'to entertain wrong information concerning their client's [Modiba] departure from the CoJ'. ALSO READ: R25.5 billion deficit over five years — Can RAF afford to pay out claims? Charges against Modiba 'were not dropped' – CoJ Atkinson said the reality is that Scopa sought information from the CoJ and he would like to state the facts of the response it received from the CoJ. He said with regard to the claim that the charges against Modiba were dropped because the CoJ no longer believed he had a case to answer, the CoJ said: 'According to our records, the charges against Mr Modiba were not dropped. He resigned during the disciplinary process.' Atkinson said the second question from Scopa to the CoJ was whether there was a mutual separation agreement as part of the settlement when Modiba resigned and had the charges dropped. Atkinson replied that the CoJ said: 'No, there was no mutual separation between Mr Modiba and the CoJ. 'There was a proposal for mutual separation from his [legal] representative, which proposal was rejected by the CoJ representatives. Subsequently, the employer resigned and left of his own volition.' ALSO READ: Expert accuses RAF of misrepresenting itself and its purpose 'We have been lied to again' – Scopa Atkinson said the CoJ was further asked if Modiba resigned of his own accord before the disciplinary inquiry could proceed – and since he was no longer an employee there was no longer a reason to pursue the matter any further? He replied that the CoJ said: 'Mr Modiba resigned during the disciplinary process when the parties could not reach any consensus on mutual separation.' Atkinson said the issue Scopa has, which is extremely serious, is that 'we have been lied to again'. 'Mr Modiba instructed a lawyer to send us a letter with falsehoods and lies,' he added. 'Now, I think the situation here is that certainly the [RAF] board needs to speak to Mr Modiba and see whether you want to continue to employ him on the basis of a lawyer's letter sent to Scopa which does not attest to the information we received from the CoJ,' he said. Atkinson also requested Scopa to report Modiba's attorney to the Legal Practice Council. 'In essence, a lie has been sent to this committee under a lawyer's letter under the full knowledge of Mr Modiba and his attorney,' he said. 'So we would ask that that attorney be reported to the Legal Professional [Practice] Council and that [the] letter be subject to an investigation.' ALSO READ: RAF management muzzled employees during investigations, SIU says The R2.6bn that left CoJ's coffers During the Scopa meeting with the RAF in March, Scopa chair Zibi referred to the fact that Modiba had reportedly left the CoJ after facing disciplinary charges related to the withdrawal of R2.6 billion. He said these funds were later linked to Regiments Capital, a firm cited during the Zondo Commission of Inquiry into Allegations of State Capture. Zibi pointed out in last month's Scopa meeting that he had asked the RAF for information about Modiba in October 2024 – and with a simple email that took four minutes the committee to draft, it received the response from the CoJ that Atkinson had mentioned. 'The [RAF] board is failing,' said Zibi. 'Vacancies in critical positions, litigation without a head of legal, people in positions who are still trying to find their feet, lawyers who rock up in court to try and overturn a matter and they don't argue it, inability to send a simple email to a previous employer to ask about the appropriateness of an employee, who then proceeds to send a lawyer's letter that is suspect at best. 'This situation cannot continue any longer. It's making a mockery of parliament and its oversight.' ALSO READ: WATCH: Letsoalo denies misleading Scopa on RAF's state of affairs Transport department to report on action being taken Zibi asked Deputy Minister of Transport Mkhuleko Hlengwa, when he next reports to parliament about the RAF, to report on what is being done to remedy this situation. Hlengwa told the Portfolio Committee on Transport last week that he would be having a meeting with the RAF board this week (the week starting 9 June) on a number of issues. The Department of Transport stated on Friday that this meeting 'will evaluate the prospects of the current board to restore good governance and effective administration at the entity so that it fulfills its primary purpose of compensating road accident victims timeously'. 'The department will consider appropriate interventions post this meeting to ensure the stability of the entity, good governance, and the fulfilment of its mandate.' This article was republished from Moneyweb. Read the original here.
The Citizen
02-06-2025
- Business
- The Citizen
Two law firms get lion's share of RAF's R103m legal services spend
A disproportionately high 84%. Scopa wants to know why. Scopa chair Songezo Zibi was unimpressed that Scopa had to ask three times before the RAF supplied information about the top 10 law firms it uses. Picture: Michel Bega/ The Citizen The Road Accident Fund (RAF) paid 84% of the total R103.1 million it spent on corporate legal services in its 2024 financial year to Malatji & Co Attorneys Inc and Maponya Ledwaba Attorneys – just two of the 43 legal firms on its panel. Malatji & Co was paid R55.87 million by the RAF in 2024 and Maponya Ledwaba R30.75 million. The RAF revealed this in a presentation to Parliament's Standing Committee on Public Accounts (Scopa) last week. These two law firms were also paid the bulk of the amount the fund spent on legal services in the RAF's 2023 financial year, with Malatji & Co paid R15.25 million and Mopanya Ledwaba R14.86 million of the RAF's total corporate legal services bill of R34.26 million that year. Zibi said Malatji & Co in particular received 'an incredibly disproportionate portion of the work allocated by the RAF'. Source: RAF presentation to Scopa, 28 May 2025 This information was initially not made available to Scopa and was only provided after committee chair Songezo Zibi complained that it had twice requested information about the top 10 law firms that received briefs from the RAF and accused the fund of deliberately withholding this information from the committee for improper reasons. ALSO READ: RAF CEO placed on special leave with full pay, as MPs grill fund Law firm selection Acting RAF CEO Phathutshedzo Lukhwareni said a panel of 43 law firms was appointed by the RAF in December 2023 but only 19 were briefed and paid during the 2023 and 2024 financial years 'at the time of preparing the report [presentation]'. Lukhwareni said the RAF has a panel of law firms and the selection takes place depending on the complexity of the matter. Scopa member David Skosana of the ANC asked what criteria is used to allocate briefs among the 43 law firms, why only 19 firms had been briefed and paid, and what measures are in place to ensure cost effectiveness and equitable distribution of work among the firms on the panel. Scopa member Mark Burke of the DA said Maponya Ledwaba Attorneys was extracting R30 million a year from the RAF but 'has got one director, three senior associates and an associate as a secretary and an admin clerk'. 'Does that seem right? Does it seem reasonable that a firm with that staff cohort could be extracting that value and delivering value?' asked Burke. Lukhwareni said some of those disbursements were for counsel fees and the cost is determined by the complexity of the matters they have handled and, if the matter is prolonged for a number of years and goes all the way to the Supreme Court of Appeal (SCA) for instance, the cost will obviously be significant. He said repeat briefings are determined by the successes the law firm have registered in the previous cases but declined to comment on the size of Maponya Ledwaba Attorneys because he is not privy to this information. 'To the extent that they [the two law firms] are in the panel and are competent to be in the panel, I don't see any unreasonability in that,' he said. ALSO READ: RAF needs a Settlement Hub for crash victims – expert The 'complex' cases Mampe Kumalo, who was referred to by Lukhwareni as the RAF's head of legal but is the fund's chief governance officer, said the complex cases these firms had or were handling include the Discovery Health, South African Revenue Service (Sars) and Auditor-General matters. The Discovery Health matters relate to various applications it launched against the RAF linked to the failure of the fund to pay the past medical expenses of claimants. The Sars matter involved an application to stop and prevent the tax collection authority from deducting R5.1 billion – or any part of this amount from the RAF levies it collects – to pay Eskom in terms of a settlement agreement between Sars and the power utility. ALSO READ: R25.5 billion deficit over five years — Can RAF afford to pay out claims? Repeat business despite repeated failure Zibi requested Kumalo to provide Scopa with a detailed breakdown by the close of business on Thursday of the fees paid to the two firms, including attorney fees, party-party costs, the cost of counsel and punitive costs orders against the RAF. 'The reason I want this is that you have persistently been clobbered on the AG matter by a law firm you continue to pay and see absolutely no reason to seek another law firm,' he said. Deputy Minister of Transport Mkhuleko Hlengwa said they must not be ignorant to the fundamental risk which prevails at the RAF because of the lawyers. 'The abuse of the system and the leakages of the money not reaching claimants in part is a result of the construct of the RAF. 'Why are we spending so much money on legal fees?,' he asked. 'We should be spending it on claimants because the whole system is fundamentally structured in a way which is problematic, hence the bill that we will be bringing … to parliament.' ALSO READ: RAF national crisis demands urgent action – expert Malatji responds Approached for comment about how the firm was able to receive such high fees from the RAF and if it has had any engagements with the Special Investigating Unit (SIU), Tebogo Malatji – MD of Malatji & Co Attorneys – told Moneyweb the firm has no way of knowing how the RAF decides to appoint attorneys on matters and what criteria it uses to do so. 'We are thus unable to tender the explanation you seek and suggest that you direct the question to the RAF. As the two directors primarily responsible for the servicing [of] the RAF, I have 31 years practice experience and Ms Sunelle Eloff, 24 years,' he said. 'We have personal injury law experience from the time that we started practice, have acted for the RAF for the most part of our practice lifespan and are therefore experts in the field. 'We are also one of the leading public law specialist firms in the country. 'We can only but speculate that the reasons the RAF instructed us in each instance that they did must have something to do with our years of experience, expertise and suitability for the matter at hand,' said Malatji. 'We have acted for the RAF in several of their most complex matters assisted by senior and junior counsel from the Bar and that accounts for the high value of payments to our firm displayed. 'Moreover, the figures displayed at Scopa as being payments to our firm consist primarily of counsel/advocates and other disbursements and to a lesser extent fees to our firm,' he added 'Until we are confronted with the actual number of instructions issued by RAF to its panel attorneys, we do not accept your assumption that it is our firm that allegedly received a disproportionate number of instructions.' Malatji added that the SIU has not engaged the firm on this issue. Maponya Ledwaba Attorneys has not responded to a Moneyweb request for comment on these same issues. This article was republished from Moneyweb. Read the original here.
The Citizen
29-05-2025
- Business
- The Citizen
RAF ‘deliberately withholding' information from Scopa
The SIU tells us that one law firm has received an incredibly disproportionate portion of the work allocated by the RAF – Scopa chair. What is the RAF hiding, and why does its R1.2m-a-year chair not think it 'important enough' to make sure Scopa is given the information it asked for? Picture: Moneyweb The Road Accident Fund (RAF) has been accused of deliberately withholding information from Parliament's Standing Committee on Public Accounts (Scopa) about the top 10 law firms to receive briefs and payments from the fund. Scopa chair Songeza Zibi said on Wednesday he has asked for this information twice, the first time on 6 November 2024. He now believes 'this information is being deliberately withheld from the committee for improper reasons'. 'In the intervening period, the SIU [Special Investigating Unit] came to brief the committee and one of the things that they told us is that one of the law firms has received an incredibly disproportionate portion of the work allocated by the RAF. 'We do not know who that law firm is but you can see why that information is pertinent.' He said he cannot understand 'why it is easy to provide the plaintiff information but it seems impossible to provide the corporate legal services information' when the committee has asked for it in writing and in the sitting. Zibi said one of the things he is concerned about is that there are names of law firms that appear on both the lists. ALSO READ: RAF CEO placed on special leave with full pay, as MPs grill fund What does the RAF chair say? RAF chair Lorraine Francois apologised for the information not being provided and assured the committee it will be provided. Zibi said his difficulty is that Francois was in the meeting and knew Scopa asked for this information, which has not been provided. Zibi said it would not be unfair to hold Francois responsible for the failure to provide this information because the board is the accounting authority. Francois said the RAF board secretary takes note of Scopa's requirements but they always assume that it is the responsibility of the RAF CEO and executive to put this information together. Controversial RAF CEO Collins Letsoalo was placed on special leave with full pay and benefits by the board on Tuesday as a precautionary measure, but it was stated that this did not constitute disciplinary action. ALSO READ: R25.5 billion deficit over five years — Can RAF afford to pay out claims? Francois said most of the time, the information requested gets submitted directly to Scopa. 'We are a non-executive board so we don't review everything that comes here directly. 'That is the responsibility of the executive. Now I take full accountability and will ensure this happens. But to respect the request of this committee, I will now get to that level to make sure we will provide this information,' she said. Scopa member Mark Burke of the DA took issue with her answer and asked her what her annual compensation is. Francois said it is about R1.2 million. 'You get paid R1.2 million, which is the equivalent of a parliamentary salary and in your mind it's too operational for you to respond to the [request] for information,' said Burke. 'That [it] is beyond the scope of your work. Does that seem reasonable to you?' Zibi said he would answer this question. 'You [Francois] didn't think it was important enough because I have raised it twice and you simply didn't bother to check. 'We are not asking you to be operational. I am asking you to ensure that the needs of the committee are met by way of information,' he said. ALSO READ: RAF national crisis demands urgent action – expert 'Terminate the board immediately' Scopa member Alan Beesley of ActionSA followed up by stating that he found Francois's response dumbfounding. 'I saw the list that [Zibi] asked for. It's not an extensive list,' said Beesley. He requested that Deputy Minister of Transport Mkhuleko Hlengwa write letters of termination immediately to the RAF board because it is acting with immunity at the moment and treating parliament with disrespect, which is totally unacceptable. Acting RAF CEO Phathutshedzo Lukhwareni said a panel of 43 law firms was appointed by the RAF in December 2023, but only 19 were briefed and paid during the 2023 and 2024 financial years 'at the time of preparing the report'. Lukhwareni said a total R6 million was paid to these law firms in 2023, and around R104 million in 2024. He said it is a panel (of law firms) and obviously the selection takes place depending on the complexity of the matter. ALSO READ: RAF at risk of imploding No state security clearance Scopa was also told that not a single member of the RAF's board or senior executive has a security clearance from the State Security Agency (SSA). Lukhwareni said all the forms have been submitted to the SSA for the vetting process and interviews have been held with some of the executives but 'from here on it's beyond our control from a RAF perspective and SSA is responsible'. Zibi said something does not match because on 16 October 2024 he had an exchange with Francois about the vetting of officials and one official, Letsoalo, was said to be vetted. Zibi pointed out that Letsoalo said in March 2025 that he had been vetted – and the difference between what he said then and the state of affairs now 'means for the second time he lied to the committee'. 'I asked him about the treasurer at the RAF and he [also] lied about that.' Scopa member Patrick Atkinson of the DA said Letsoalo – who was initially acting CEO of the RAF and has now been CEO for five years – has been without a security clearance for seven years. Atkinson said the problem with that is that (without clearance) Letsoalo has not been legally appointed to that position and the question then is how would he have the authority to take the legal action he has against the Auditor-General (AG). ALSO READ: Expert accuses RAF of misrepresenting itself and its purpose The RAF unsuccessfully applied to review and set aside the AG's disclaimer of the fund's 2020/2021 annual financial results and to declare the disclaimer invalid and unlawful. The AG issued the disclaimer because the RAF used an accounting standard it was not permitted to use. 'I understand the court might give him six months to get his security clearance but not seven years,' Atkinson said. 'If he has been operating for seven years without a security clearance, it raises a massive legal issue about a whole variety [of issues] about the accounting principles, not paying out medical aids and foreigners and a whole variety of board minutes which are illegal.' Zibi said he would have to take legal advice on that and would not hold the Department of Transport or RAF responsible for the tardiness of the SSA. He said Scopa will take that up with the responsible minister, but the committee needs to work out if Scopa was misled when the CEO told the committee that he had been vetted. This article was republished from Moneyweb. Read the original here.
The Herald
29-05-2025
- Business
- The Herald
DA welcomes RAF CEO Collins Letsoalo's placement on special leave
The placement of Road Accident Fund CEO Collins Letsoalo on precautionary leave is a long-overdue but necessary step to ensure that the Special Investigating Unit (SIU) can conduct its preliminary investigation without interference or influence, the DA said on Wednesday. The transport department said the decision was in the interest of good governance and a precautionary step to facilitate ongoing investigative processes. 'It does not imply any prejudgment or adverse finding against the CEO.' The DA said Letsoalo's temporary removal from office must facilitate full transparency and accountability, particularly in light of serious allegations concerning the RAF's governance failures, financial mismanagement and possible misconduct. Briefing the standing committee on public accounts (Scopa) last month, the SIU said it had experienced a lack of co-operation from the RAF in its investigation into the affairs of the entity. 'There were instances where the SIU had to resort to opening a criminal case against a RAF executive for failure to adhere to a lawful subpoena issued by the SIU in terms of the SIU Act,' SIU head Any Mothibi said last month. The DA said the ministry of transport's support for the decision to place Letsoalo on leave must be followed by full co-operation with Scopa and law enforcement agencies. 'The precautionary suspension of the CEO is just the beginning. The DA will not rest until justice and good governance are restored at the RAF.' TimesLIVE
