The Mpumalanga Economic Growth Agency (MEGA) has been stripped of one of its flagship responsibilities — the Premier’s Youth Development Fund (PYDF) — after a damning trail of financial mismanagement, expired debt claims and failed oversight.
MEGA was created over a decade ago with a bold vision to drive provincial development, support small businesses, attract investment and help historically disadvantaged South Africans tap into the economy.
Culture of non-compliance
But by 2025, its track record had disintegrated under the weight of ballooning debt and a culture of non-compliance.
The removal of the PYDF follows the expiry of a formal agreement that had allowed MEGA to manage it since 2022.
With Premier Mandla Ndlovu opting not to renew that agreement, the agency was excluded from receiving any allocation in this week’s re-tabled provincial budget.
The Mpumalanga Provincial Treasury made no provision for the PYDF under MEGA. This effectively cements the agency’s removal from the programme’s administration.
MEC for Finance Bonakele Majuba confirmed during his budget speech that the office of the premier has been allocated R493.8-million, noting that it would ensure “executive leadership and accountability for service delivery throughout the provincial administration”.
Job creation for young people
While Majuba made no specific mention of the PYDF, he reiterated that the province remained committed to “job creation for young people, women, and people with disabilities in our province”.
This week, the DA welcomed the fund being removed from MEGA. It labelled the move “a necessary demotion” of a state agency that has “dismally failed in most of its mandates since its inception in 2010.”
DA provincial spokesperson on finance and economic development, Trudie Grovè-Morgan, told Sunday World that the agency had failed to meaningfully impact youth unemployment, despite being entrusted with R90-million for the fund since 2022.
“MEGA has also been red-flagged by both the Auditor General and the Select Committee on Public Accounts (SCOPA) for financial mismanagement,” said Grovè-Morgan. “The AG mentioned that ‘this casts significant doubt on the entity’s ability to continue functioning’.”
R285m in loans and other receivables
According to Sunday World’s previous reporting, MEGA’s financial woes run deep. The agency has failed to recover over R285-million in loans and other receivables. Much of these it handed to start-ups that disappeared without repaying a cent.
“The debt claim must be prosecuted within three years. It’s now past five years,” SCOPA provincial chair Desmond Moela earlier reported to the legislature. “The prospect of success in this case is too limited because of the Prescription Act of 1969.”
Moela also revealed that MEGA had ignored legal advice, continued disbursing risky loans, and racked up R248.6-million in irregular expenditure.
In the 2023/24 financial year alone, the agency spent R18.1-million through unauthorised contract extensions and procurement irregularities.
This backdrop of mismanagement has now culminated in the loss of the PYDF, which was meant to provide funding and mentorship for entrepreneurs aged 18 to 35 in a province with one of the country’s highest youth unemployment rates.
Memorandum of Agreement
In response to media queries from Sunday World, MEGA confirmed that the Memorandum of Agreement governing the PYDF expired but denied allegations that it had failed to implement the programme.
“That is denied in so far as it is inconsistent with the truth,” said MEGA CEO Isaac Mahlangu in a written response.
However, the agency also admitted that the removal of the PYDF had impacted its ability to disburse funds to micro-, small- and medium- enterprises, as no new approvals were granted in the current financial year.
When asked about the DA’s scathing remarks, Mahlangu reiterated the expiry of the agreement. However, declined to provide a broader assessment of the agency’s performance.
Grovè-Morgan said the programme’s return to the Premier’s office may restore accountability.
AG’s report
“MEGA’s management does not provide leadership based on a culture of honesty, ethical business practices and good governance,” said Grovè-Morgan, quoting from the AG’s report. “We hope the premier’s office makes a better effort to close the youth unemployment rate this time around.”
The agency also remains without a permanent chief financial officer or critical senior managers. This has raised concern about whether MEGA can still be trusted to manage public money or support economic growth.
“The premier needs to act now and disband MEGA,” said Grovè-Morgan.
“This agency has neither the necessary skills nor expertise to be at the forefront of economic growth.”
