Admin
12 Mar, 2025
Mismanagement of City Power: R4.9 billion in irregular expenditure
Statement by Andile Jabavu, Gauteng Provincial Secretary of the United Democratic Movement The United Democratic Movement (UDM) in Gauteng is deeply concerned about the Auditor-General’s (AG) shocking findings on the City of Johannesburg's City Power, revealing a staggering loss of R2.8 billion in the 12 months ending 30 June 2024. Even more alarming, the entity incurred irregular expenditure exceeding R4.9 billion, raising serious questions about financial mismanagement, corruption and governance failures. City Power, a vital municipal entity responsible for electricity supply in Johannesburg, is teetering on the brink of collapse. The AG has warned of “material uncertainty” regarding its ability to continue operating, with its liabilities exceeding assets by R1.1 billion. These revelations come as residents endure frequent and prolonged power outages, exacerbating Johannesburg’s ongoing electricity crisis. Of particular concern is the R12 million advance payment allegedly made to a politically connected businessman, for a public lighting project, months before any work was done. Reports shows that internal City Power officials raised red flags, warning that this payment violated Treasury regulations under the Municipal Finance Management Act and the Public Finance Management Act. However, these concerns were allegedly overridden by a senior official who instructed subordinates to process the payment despite clear irregularities. Even more alarming, the businessman in question is allegedly linked to a known African National Congress benefactor, raising serious concerns about political interference. Transparency and accountability are non-negotiable, yet City Power’s response to these grave allegations have been vague, with promises of investigations that have so far produced no tangible results. Meanwhile, Johannesburg residents continue to endure worsening infrastructure and daily power failures. The UDM in Gauteng will not stand by while public funds are mismanaged at the expense of service delivery. We call on the City of Johannesburg and law enforcement authorities to act decisively in rooting out corruption and ensuring that those responsible for City Power’s financial collapse are held to account.
