Broken street lights on Cape Road, Gqeberha, on 2 October 2025. (Photo: Deon Ferreira) 
An investigation into controversial 2020 streetlight contracts issued by the Nelson Mandela Bay metro has uncovered cases of fraud, the Contravention of the Prevention and Combating of Corrupt Activities Act and contravention of the Prevention of Organised Crime Act, Minister of Cooperative Governance and Traditional Affairs Velenkosini Hlabisa told Parliament in a written answer to a question.
The question was asked by Marina van Zyl of the DA.
He said the Special Investigating Unit (SIU) provided his office with the information.
“The investigation focuses on whether the process and payments were unfair, non-competitive, non-transparent, or contrary to legislation and Treasury guidelines,” Hlabisa said.
The SIU investigation began in July last year after President Cyril Ramaphosa signed a proclamation permitting the SIU to investigate maladministration in the metro and to recover any financial losses suffered by the state or the metro, with a specific focus on the supply, delivery and offloading of streetlighting and floodlighting luminaires and payments made for this.
Read more: Special Investigating Unit to probe streetlight tender in Nelson Mandela Bay
Hlabisa continued in his answer that according to the preliminary SIU report, three companies, with their directors, and more than 10 officials were involved.
“The names of the companies and officials involved cannot be divulged at present as the investigation team is busy processing the right of replies for disciplinary referrals and preparing referrals to the National Prosecuting Authority. The presidential report has not been issued yet.
/file/dailymaverick/wp-content/uploads/2025/06/ED_540509-2.jpg "Cogta Minister Velenkosini Hlabisa. (Photo: Gallo Images / Lee Warren)")
“The SIU has established that the procurement undertaken by the municipality was irregular and must be set aside. A memorandum has been prepared and forwarded to the [relevant unit] for consideration. Several officials from the municipality failed to adhere to the SCM and finance policies as well as the Municipal Finance Management Act,” Hlabisa continued.
Hlabisa said the SIU was preparing disciplinary referrals to the municipality for misconduct, criminal referrals to the NPA and administrative referrals for the blacklisting of implicated service providers.
“The SIU is busy preparing systemic recommendations on the processes and systems in the municipality and referring evidence to the Civil Litigation Unit for civil litigation to set aside the contracts at the Special Tribunal,” he added.
Hlabisa said the metro had cooperated with the SIU by providing the documents and information requested in support of the investigation.
Whistleblowers on R24m expenditure
In 2024, acting on information received from whistleblowers inside the Nelson Mandela Bay metro, Tukela Zamani, now a leader of the Mayibuye Civic Movement, but then a member of the Defenders of the People, opened a criminal case relating to allegations about the controversial 2020 streetlight tenders.
An internal municipal report had surfaced at the time, indicating that the municipality’s electricity department incurred R24-million in irregular expenditure through contracts for the replacement and repair of streetlights.
The ongoing investigation has led to a dangerous situation in the metro, as an estimated 10,000 broken streetlights had not been replaced as contracts were put on hold or cancelled.
The Nelson Mandela Bay metro’s Department of Electricity and Energy has been identified as one of the biggest financial risks to the metro. It is running at a loss of R1.3-billion due to non-revenue electricity losses, caused by factors including meter tampering and illegal connections.
The former executive director of the Department, Luvuyo Magalela, resigned from his position in August 2024. At the time, rusted high-voltage pylons had collapsed, damaging the Eskom power line and causing an electricity outage of close to a week in the metro.
Other probes
The streetlight probe is not the only one involving the metro’s electricity department. A year ago, six officials faced suspension notices for allegedly placing unauthorised orders for R10-million-worth of copper cables. The Hawks are also investigating supply chain fraud after a substation explosion in Coega, and a subsequent damning internal audit that led to the precautionary suspension of seven officials for alleged fraud and corruption in supply chain management.
Earlier this year, acting executive director for Electricity and Energy Tholi Biyela resigned from his position after he was threatened and forcefully removed from his office. Before that, he had submitted a detailed turnaround strategy for the directorate.
“Corrupt activities by some employees have eroded public trust and weakened internal controls, with limited consequences for those involved. The absence of strict enforcement measures allows corrupt practices to continue unchallenged. Failure to impose serious consequence management for misconduct or mismanagement has created a culture of impunity, weakening governance structures and enabling corrupt practices to flourish [...],” the strategy reads.
Read more: When Nelson Mandela Bay’s mayor said ‘there will be lights’ on 1 October, was she right?
Facing enormous political pressure, contracts were approved for the repair and replacement of streetlights last year. Daily Maverick is awaiting an update on how this is progressing. DM