Minister of Public Works and Infrastructure Dean Macpherson has declared war on corruption within his department, detailing ongoing investigations into lease failures, ghost employees and officials who have resigned rather than face lifestyle audits.
Speaking at a press conference on Wednesday, Macpherson revealed the department is facing a damages claim exceeding R50-million over a R69,5-million lease for a Pretoria building that was never occupied, in what investigators described as a “self-created emergency” by officials.
The Property Management Trading Entity (PMTE) concluded a five-year lease for 146 Lunnon Road in March 2023 for the then Department of Public Enterprises, despite that department already being set for reconfiguration and closure. The building has remained vacant ever since.
When the National Prosecuting Authority’s Independent Directorate Against Corruption required accommodation in 2025, a procurement process for CSIR property in Brummeria had already been undertaken. However, according to the department’s Anti-Corruption and Fraud Awareness Unit, that submission failed to proceed, creating an urgent need to place the unit at 146 Lunnon Road instead.
Lawyers acting for the lessor have now written to the department alleging breach of contract, requesting arbitration through the Arbitration Foundation of Southern Africa and demanding damages of more than R50-million.
“The state cannot continue to tolerate a system where poor planning, delays or internal obstruction are allowed to create an emergency, and that emergency is then used to justify decisions that expose the public to financial and legal risk,” Macpherson said.
The PMTE’s overdraft has doubled to nearly R4-billion in the past 20 months, and despite the state owning thousands of buildings, government continues to spend approximately R6-billion annually on private leases, many raising concerns about value for money and legal compliance. The entity has not achieved a clean audit since its establishment in 2014.
At least 15 lease agreements for various departments remain outstanding, some delayed since March 2025, including leases for the departments of International Relations and Cooperation, Cooperative Governance and Traditional Affairs, and Women, Children and Persons with Disabilities.
Ghost employees identified
A ghost employee audit has identified 60 individuals who appear to have been paid salaries for years while not in the employ of the department, with the majority of cases found in KwaZulu-Natal.
“This raises obvious questions about how these payments were processed, who authorised them, whether internal controls failed, whether officials looked the other way, and whether public money can be recovered,” Macpherson said.
The department is working to finalise the audit, determine the full extent of payments, identify those responsible and ensure disciplinary, civil and criminal steps follow where wrongdoing is confirmed.
Officials resign rather than face scrutiny
Three officials have resigned after refusing to submit required documentation for lifestyle audits, which Macpherson said “tells its own story”.
“Officials who manage public money, leases, contracts, properties and infrastructure projects must be prepared to account. That is not an attack on public servants. It is a basic requirement of public trust,” he said.
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The minister also announced he has withheld Expanded Public Works Programme funding to eThekwini Municipality for the 2026/27 financial year following Auditor-General findings regarding ghost beneficiaries and irregular payments. Listening tours have revealed political gatekeeping, manipulated lists and allegations of sex-for-jobs in the programme meant to provide work opportunities to unemployed South Africans.
Macpherson has also extended the scope of a forensic investigation into tenders for PSA Oxygen Plants, focusing on the role of Department of Health officials. Three officials have been preliminarily identified, with allegations relating to non-compliance with procurement processes.
In another matter involving the Telkom Towers complex in Pretoria, which involved approximately R1,4-billion in expenditure and an estimated loss of R776-million, Macpherson has rejected a forensic report as “materially insufficient and inadequate”.
Macpherson further stated that despite the state owning thousands of buildings and large portions of land, the government continues to spend approximately R6 billion a year on private leases, many of which have raised serious concerns about value for money, market-related pricing and proper legal compliance.
“This is not sustainable,” he said.
“We either allow weak systems, failed leases, irregular payments and poor consequence management to continue, or we confront them directly and rebuild the department around accountability, delivery and the public interest,” the minister said.
“The agenda of reform is irreversible, no matter how hard some may try.”
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