The Democratic Alliance (DA) has called on the Public Service Commission (PSC) to investigate Dawid Kruiper’s lease of The Eiland Resort, as the municipality attempts to push ahead with a four-year exemption on rental fees totaling R2,862 million.
The DA had misgivings about the lease since Council voted against the DA’s recommendation in 2022 to advertise the tender nationally. The municipality instead opted to entertain private negotiations, after receiving a single application and locally publicizing their intent to lease the resort, raising suspicions of unfair bias.
Subsequent financial reports have highlighted that the successful tenderer has not made payment since the contract start date on 1 December 2022. The municipality has also been paying for electricity usage at the resort, with total loss of rental and services debt income standing at R3,8 million in December 2024. Despite this, the municipality failed to impose penalties based on breach of contract.
The municipality’s Tender Adjudication Committee justifies the exemption of rental fees based on the past high levels of theft and vandalism at the resort, and its poor condition at the time it was leased. The DA is questioning the justification for the exemption, as the state of the resort was known to both the lessee and the lessor before the market value rental fee was calculated and the deal was sealed.
That the exemption addendum to the lease was signed on 28 June 2024, without the knowledge of council, coupled with the municipality’s refusal to accede to the DA’s request to place the contractor on the Contract Debtors list, further points to a critical lack of transparency in the management of the lease, opening the way for underhanded and unethical conduct within the municipality. Given that the lease extends until 30 June 2037, also signals non-compliance to Section 33 of the MFMA, which demands a high level of accountability and transparency in contracts that extend beyond a three-year period.
Harold McGluwa, DA Provincial Leader, has submitted a complaint to the PSC. An investigation into The Eiland’s lease will go a long way towards helping rid local government of maladministration and corruption and improve compliance within the public service.
We also take note of the Auditor General’s recommendation to Council not to proceed with the exemption and will monitor developments closely.
The Eiland resort is a well-known Upington landmark and must ultimately benefit the local tourism industry and the local economy, not the pockets of protected cadres.