ActionSA member of the Mpumalanga provincial legislature, Thoko Mashiane, has called for a full forensic audit into the Mpumalanga Economic Growth Agency (Mega).
Mashiane is also demanding a review of Mega’s operating model and a complete overhaul of its leadership, which she believes is essential to restoring credibility and effectiveness.
She raised concerns about Mega’s financial mismanagement, governance failures, and what she sees as a lack of real impact on the province’s economic development.
Speaking during a debate in the legislature, she criticised the agency for not attracting meaningful investment, failing to support small businesses, and not delivering large-scale projects that could help reduce unemployment.
Symbol of poor financial management
“Established to stimulate investment, promote industrial development, and facilitate empowerment opportunities for SMMEs [small, medium, and micro enterprises] and emerging black entrepreneurs, Mega was supposed to be a vehicle for economic transformation,” Mashiane said.
“But what we see today is an entity that has become a symbol of bureaucratic drift, poor financial management, and a disconnect from grassroots economic realities.”
According to a report seen by Sunday World, Mega suffered material losses of R110.1-million in financial assets and R175-million in trade and other receivables due to unpaid loans.
To recover these losses, the agency stated that it has started eviction processes against tenants who have failed to pay rent.
Mega reported irregular expenditure of R18.1-million for the 2023/24 financial year, an increase from R16.9-million in 2022/23.
The total accumulated irregular expenditure now stands at R248.7-million.
Issues that could stop Mega from getting a clean audit in 2024/25 include ongoing issues, such as unpaid loans, too many job vacancies, and small businesses in their buildings not doing well.
Flagged by the auditor-general
Mashiane said that despite receiving significant funding over the last three years, Mega continues to be flagged by the auditor-general for weak governance and wasteful expenditure.
She cited the failed Afri-hub project in Mkhondo as a clear example of this.
“It now stands as a monument of wasted potential, riddled with allegations of poor workmanship and no commercial activity to speak of,” she said.
The report also highlights longstanding issues, including weak internal controls; high staff vacancies, including the chief financial officer post; and unresolved irregularities dating back as far as 2017.
“Where are catalytic projects? Where are the jobs? Where are the thriving township enterprises that Mega was meant to support? In places like Bushbuckridge, eMalahleni, and Nkomanzi, local SMMEs are collapsing.
“[This is] not due to lack of ideas and ambition, but because the very agency meant to assist them cannot disburse funding on time, fails to provide aftercare support, and often lacks the technical capacity to evaluate proposals objectively.”
