ANC leaders accused of corruption and ‘capture’ of Joburg entities

While residents battle water cuts and filthy streets, Pikitup and Joburg Water leaders face multibillion-rand nepotism claims

The ANC in Johannesburg has allegedly captured city-owned companies Pikitup and Johannesburg Water with the appointment of relatives who did not apply for posts.

In addition, a report detailing R1.3  billion of corruption unearthed in a forensic report was covered up.

At Johannesburg Water, Sasabona Manganye — the ANC’s Johannesburg region secretary and a member of its top five officials — has been implicated in alleged nepotism regarding the vacant R2.6  million-a-year chief operations officer position at the company.

Senior executives and managers at Johannesburg waste management company Pikitup employed their relatives as part of the 300 general workers hired in February at its 12   depots. 

Two senior city officials told the Mail & Guardian that the ANC had “captured” Johannesburg entities despite not holding an outright majority in the council. 

“It used to be the high-paying jobs that ANC leaders used to influence in favour of their members or relatives. It now seems like general worker positions that pay R15  000 a month are also not exempt from the ANC’s interference,” said one official, who asked to remain anonymous. 

The apparent shenanigans at Pikitup and Johannesburg Water come as residents have to endure uncollected waste, particularly in the city centre, and crippling water cuts since March in a city that has had unstable leadership, with four different mayors since the November 2021 local government elections. 

Maxwell Nedzamba, Pikitup board chairperson and treasurer of the ANC in Johannesburg, has three relatives employed as general workers at Pikitup’s Midrand, Roodepoort and Central Camp depots, despite not appearing on the city’s official list of 17  073 people who applied for the positions. 

As treasurer, Nedzamba is one of the ANC’s top five officials in the region.

The list of candidates who applied for jobs does not include Nedzamba’s relatives, whose names are known to this publication. The relatives, who share the same surname as the ANC’s regional leader, are however recorded on the final spreadsheet of appointed workers. 

According to travel logs from Pikitup, the entity directed its driver, identified as Stanley Minnie from city records, to use a company vehicle to fetch Nedzamba’s family members from Johannesburg Park Station after arriving by bus from the Venda area of Limpopo. 

A highly placed Pikitup source said Minnie was unaware who he was sent to fetch at the station. 

“Stanley arrived at Park Station and saw people with heavy luggage that he had to drop off in Diepsloot,” said the source, who asked to remain anonymous. 

Kagiso Lusithi, Pikitup’s general manager for security and facilities, and Dumisani Langa, the employment relations general manager, also have relatives with the same surnames working at the entity’s depots without applying for the jobs, according to official city records. 

Moreover, Nedzamba chairs the board that rejected a November 2022 forensic investigation and rehired, on a fresh four-year contract that began in June last year, Pikitup chief financial officer Litshani Matsila, who was found to be “grossly dishonest” in losing about R1.3  billion through “fraud and corruption”.

Interestingly, Matsila also has a sibling appointed as part of the 300 general workers. Matsila’s family member, who will be 42 years old in October, was placed at the Norwood depot and does not appear on the list of applicants, but was hired in February. 

In a statement sent to the M&G and signed by Nedzamba and Bukelwa Njingolo, Pikitup’s managing director, the city-owned entity defended the reappointment of Matsila as chief financial officer. 

The statement added that the November 2022 findings were “nullified” because the September 2022 “special meeting” which led to them was convened by the previous Pikitup board without “seeking approval from the city as the shareholder” after exceeding the allocated number of gatherings they can hold in a financial year. 

Matsila was suspended and then found guilty on six counts of fraud and corruption after the forensic investigation’s findings before his initial four-year contract expired in February last year.

But he was temporarily reinstated the following month by the new board chaired by Nedzamba after it was appointed by then-mayor Thapelo Amad. Matsila’s fresh four-year term was ratified in June. 

“During his suspension, the CFO [chief financial officer Matsila] lodged a grievance with the city against the unprocedural process that was followed by the board in processing allegations against him. The city manager [Floyd Brink] wrote to the board to remedy the defective processes,” Nedzamba and Njingolo stated, adding that a legal opinion that the board sourced “confirmed the unprocedural aspects” of the Matsila inquiry. 

The findings against Matsila stated that he was “a threat to the best interests” after he “abused his powers” in awarding about R1.3  billion to 18 companies to provide Pikitup with 124 vehicles for waste management operations at four depots. 

The 18 companies were “unsoundly and unreasonably” appointed on a 24-month “as-and-when” basis following the 31 July 2020 lapsing of the previous 32-month lease agreement Pikitup had with the rental company Avis, the report stated. 

Pikitup has only 24 functioning vehicles out of roughly 130 needed to do its work. 

“In addition, the CFO, after the appointment of the service providers for ad hoc services, would receive requests for augmented services, such as trucks and other services, directly from the depots — a system which he had implemented contrary to either any discernible SCM [supply-chain management] or fleet management process,” reads the report.

“Thereafter, and without any due SCM or official procurement process, the CFO would unilaterally select the service provider to provide the service(s) requested.”

But Nedzamba and Njingolo said this week that the “illegal” report into the senior executive was “rejected” by the new board, which — “as part of remedying the process [that] was now declared flawed” — commissioned a new investigation into Matsila using the City of Johannesburg’s Group Forensic and Investigation Services (GFIS). 

They added that the new inquiry’s report was tabled to the board last month. “The report found that the allegations against the CFO were not substantiated, which resulted in the exoneration [of] the CFO,” they stated. 

But the M&G has seen the invoices and “fraudulent” payment details to the 18 companies cited in the November 2022 findings, while Nedzamba and Njingolo did not provide details of the new investigation submitted last month. 

Although Pikitup said in its statement that it would not answer “each and every allegation” contained in the M&G’s questions, the entity confirmed that unsuccessful candidates in the recruitment of the 300 general workers embarked on protests that disrupted waste management operations. 

Nedzamba and Njingolo stated that the city manager “demanded that a full forensic investigation be conducted into these allegations of impropriety and nepotism”, adding that GFIS was tasked with the inquiry, which was “still under way”.

They however said that to ensure “transparency, impartiality, integrity, and credibility”, the recruitment was outsourced, and none of the senior officials alleged to have family members employed by Pikitup were involved in the hiring process.

“While we intend to handle this response in such a manner that it doesn’t preempt the outcome of the independent investigation, evidence in our possession does confirm that all appointed candidates to the 300 positions went through the same application process as centrally handled by the city,” reads the statement. 

“Our undertaking and commitment are that should the investigation implicate any of our employees in improper misconduct, full and harshest sanctions will be taken following a process of consequence management and remedial actions.” 

Three weeks ago, the M&G reported that Gugulethu Phakathi — Johannesburg Water’s former board chairperson who sits on the structure as a non-executive director — was shortlisted for the chief operations officer post after the May job advertisement was allegedly tailored to suit her qualifications. This was after Phakathi did not meet the original academic requirements when the vacant post was earlier advertised in December. 

Notes from a 2 July meeting of the ANC’s regional executive committee detail that the office bearers, including chairperson Dada Morero — who is also the city’s mayoral committee member for finance — should investigate Manganye’s alleged interference in local government appointments.

The M&G’s 5 July report noted that the chief operations officer post that Phakathi and two others were shortlisted for initially required, among other things, a National Qualification Framework (NQF) postgraduate degree in business management or engineering at level eight when it was advertised in December. Phakathi did not fully meet the requirements, having a University of Johannesburg bachelor of technology (BTech) in mechanical engineering, which is an NQF level seven qualification. Her qualifications were catered for in the May job post. 

It has now emerged that the ANC in Johannesburg ordered an investigation into its secretary, Manganye, and his alleged influence in ensuring that Phakathi received the executive position. 

Phakathi, according to her social media pages, is an active member of the ANC in Johannesburg, and regularly attends and hosts political programmes for the organisation, including running the ANC Women’s League’s young women’s desk activities against gender-based violence.

The M&G spoke to several members of the ANC in Johannesburg’s regional executive committee, who detailed the structure’s concern with Manganye’s alleged “bulldozing” of the Johannesburg Water board to appoint Phakathi.

One said deployments to city-owned entities were usually discussed among the regional office bearers, which includes Nedzamba, Manganye and Morero as the treasurer, secretary and chairperson, respectively, of the ANC in Johannesburg. 

The source added that Manganye “tried to smuggle in” Phakathi’s appointment as Johannesburg Water’s chief operations officer without discussing it with the office bearers. 

“Phakathi’s appointment was dismissed outright because of the water troubles in the city. When he [Manganye] failed to smuggle in Phakathi’s appointment, he went directly to the [Johannesburg Water] board members, who pushed officials in the entity to advertise the post, which had as its minimum requirement an NQF level eight,” explained the insider. 

Another source in the ANC’s regional executive committee described a February meeting of the structure, where a committee member alleged that two directors sitting on the Johannesburg Water board claimed that Manganye was “putting them under pressure to employ Gugu”.

“The pressure from Manganye resulted in the re-advertisement of the position to suit Gugu. The regional executive committee was disturbed by the allegations — causing the meeting to last past midnight, having begun at 6pm — and a resolution was taken for the regional office bearers to investigate the claims against Manganye,” the source added. 

The insider’s views were supported by another regional executive committee member, who said the investigation into Manganye was postponed owing to the ANC’s campaign for the May national and provincial elections. 

The second regional executive committee member said the structure met on 2 July, and resolved that the regional office bearers should continue with the inquiry into allegations against its secretary. 

When contacted for comment, Manganye said he was “shocked” at the allegations against him, adding that the ANC in Johannesburg’s spokesperson, Masilo Serekele, would respond on his and the party’s behalf. 

Serekele denied that the regional ANC held any meeting that resolved to investigate Manganye, despite being provided details of the gathering by the M&G. 

“There have never been any ANC regional meetings, which discussed any appointments into municipal entities. 

“This clearly exposes how much you have been misled for [a] cheap political agenda that seeks to cast aspersions in the office of the regional secretary,” Serekele said. 

He did not answer questions on the alleged capture of the ANC in Johannesburg, including the political implications for the party in 

promoting good governance in the city. 

The revelations come as Morero is set to replace Kabelo Gwamanda as Johannesburg mayor with the support of ActionSA’s 44 councillors in the 270-seat council. 

No party holds an outright majority, with the ANC having the most seats at 91 followed by the Democratic Alliance with 71. 

ActionSA leader Herman Mashaba, who had previously stated that his party would “never” work with the ANC, made an about-turn on Monday by saying his party would support the ANC’s candidate for mayor. 

“It’s the current mayor [Gwamanda] that we do not want, this job is way beyond his capacity. We are not going to dictate who the ANC must put forward. The only thing we said to the ANC is that please give us someone who can serve the residents of Johannesburg,” Mashaba said.