NELSON MANDELA BAY — The National Treasury has formally declared the Nelson Mandela Bay metropolitan municipality’s proposed R23 billion write-off unlawful, halting attempts to clear historic irregular expenditure without proper financial scrutiny. Following the national watchdog’s intervention, DA Councillor Gert Engelbrecht is demanding a mandatory, item-by-item investigation, warning that officials who force the blanket clearance will face personal financial liability.
The Treasury’s decisive rebuke centers on two critical failures: the Municipal Public Accounts Committee’s (IMPACT) inability to investigate the spending on a granular level, and a legally defective affidavit submitted by acting city manager Lonwabo Ngoqo.
Engelbrecht revealed that the contentious financial item was abruptly “parachuted” into the IMPACT agenda, leaving committee members a mere 30 minutes to review the massive clearance request. This rushed approach deliberately bypassed the rigorous oversight required by the Municipal Finance Management Act (MFMA). Following a recent council meeting where the DA successfully deferred the item, Engelbrecht emphasized that the municipality is legally obligated to return the matter to IMPACT.
A comprehensive Section 32 report is required to investigate each transaction individually. According to Engelbrecht, this detailed approach is the only lawful method to determine if the public funds can be recovered and to identify exactly which political or administrative figures should be held accountable for the missing money.
The DA’s prior correspondence urging the National Treasury to intervene has now been validated. Treasury’s formal response confirmed that the affidavit presented by the city is deficient and that a proper Section 32 investigative process must precede any write-off decision. Engelbrecht noted that several individuals currently employed by the municipality could be directly implicated in these financial irregularities, yet they are currently allowed to continue their roles unchallenged.
A major point of contention is the coalition government’s reliance on the three-year prescription period under the Prescription Act to wipe out historic debt accumulated between 2009 and 2021. However, the National Treasury has made it clear that the sheer age of the debt does not absolve the municipality of its duty to investigate. Prescription does not bypass consequence management; rather, an investigation must first establish liability before any decision to write off the debt or pursue criminal procedures can be lawfully made.
Engelbrecht stated that the current coalition government is forcefully resisting these oversight measures. The administration has refused to provide the necessary year-by-year breakdowns of the R23 billion deficit or disclose who authorized the historic transactions. The DA characterizes this lack of cooperation as a bullying tactic designed to protect specific officials and politicians from consequence management.
In response to the continued push for a backdoor approval, the DA has written directly to the acting city manager and the council speaker to formally register their opposition to the current process. Engelbrecht warned that if the council attempts to force the vote without the required investigation, the DA will escalate the issue to both the National Treasury and the Auditor-General of South Africa (AGSA).
Furthermore, citing the legal precedent set by the Mabisa judgment, the DA is prepared to hold the acting city manager and any councillor voting in favor of the unlawful write-off personally liable. This legal avenue would allow the DA to seek recovery of the public funds directly from the individuals who forced the decision through.
The DA maintains that its ultimate goal is not merely to block the write-off, but to ensure a transparent, item-by-item investigation. This process is vital to inform residents exactly how their hard-earned rates are being spent and to ensure that those responsible for the historic financial mismanagement face appropriate legal and administrative consequences.
