Cash crisis threatens MK Party election campaign - TimesLIVE

The MK Party, which helped inflict a historic defeat on the ANC in the 2024 elections, is facing a financial crisis that insiders fear could leave it unable to hold the high-profile manifesto launch it had planned for this year’s local government elections.

The party, which emerged as the country’s third-largest political force in the 2024 elections, is also battling an escalating internal crisis over the selection of councillor candidates, with complaints about the lists submitted to the Electoral Commission of South Africa (IEC) now under investigation.

Three senior party insiders told the Sunday Times that the problems had raised questions about the MK Party’s ability to run an effective campaign ahead of the November 4 elections.

The party is expected to perform strongly in KwaZulu-Natal, with some polls projecting that it could take outright control of the eThekwini metro.

But insiders say the party is struggling to pay service providers, while disputes over the handling of its finances have created further uncertainty.

The latest crisis erupted this week when MK Party branches in KwaZulu-Natal protested over the councillor candidate lists submitted to the IEC. The branches alleged that names of candidates who had been selected by party structures were removed and replaced with others.

The Sunday Times has learnt that similar complaints had been raised with the party’s national leadership by regional and provincial leaders in KwaZulu-Natal, Mpumalanga and the Free State for weeks.

One insider said the complaints were not confined to eThekwini.

“It goes far beyond eThekwini. It is not only KwaZulu-Natal. We have comrades who are unhappy in Mangaung, Msunduzi and Mbombela. The presidential task team has been running the party as if it belongs to them.

“There is a lot of anger, and people are blaming the secretary-general [Sibonelo Nomvalo] for what has happened. This is a problem because we risk having activists who do not want to work or people who refuse to campaign,” the insider said.

The allegations prompted party president Jacob Zuma to order an investigation into the candidate selection process.

In a statement this week, the party said Zuma regarded allegations that legitimate candidates had been removed from lists submitted to the IEC and replaced with other names as serious.

“The integrity of the organisation cannot be compromised,” the party said, adding that there was “no place for manipulation, political gatekeeping or the abuse of organisational processes”.

Zuma removed Zandile Hlophe-Mkhwanazi and Sibonelo Maphumulo from the national party liaison committee and disbanded the presidential task team. Hlophe-Mkhwanazi was also the party’s mayoral candidate for eThekwini. She has since been replaced by former African Transformation Movement (ATM) member Mxolisi Phakathi, an influential cleric.

But behind the political turmoil is a financial problem that insiders say could affect the party’s election campaign.

An eThekwini insider said service providers who had worked with the party since its formation were now reluctant to take on more work because of unpaid bills.

“It has been chaos. We have service providers telling us they are frustrated because they have not been paid. These are people who helped us when we were starting the organisation,” the insider said.

“Some are small businesses that believed in the party and wanted to see it succeed. They did the work, but they have not been paid. Now they do not want to work with us.”

The insider said the party had wanted to launch its manifesto in eThekwini, where it hopes to take control of the metro.

“We wanted the manifesto launch here. We wanted to show the people of eThekwini that we are ready to lead. But now there is a perception that we do not pay people.

“If businesses do not want to work with us, how are we going to pull off the kind of launch we wanted?”

A third insider said the party’s financial problems had deepened after control of its finances was centralised.

The insider said former secretary-general Floyd Shivambu had centralised financial control in his office before Zuma later took over the party’s finances.

“When the president took over the finances, he took control of the contracts with service providers. Businesses that were waiting to be paid were left without payment because their contracts were not recognised.

“The president was trying to stop people from looting the organisation, but legitimate businesses were caught up in that.”

The insider said the party had initially envisaged a major manifesto launch to coincide with its first local government election campaign.

“We wanted something big. This is our first local government election, and there is a real possibility that we could take eThekwini. That is huge.

“But I doubt we will have the manifesto launch we originally planned. We do not have the money. We will have to raise funds or ask businesses to help us. Otherwise it will have to be a much smaller event.”

Last month, Zuma announced that he had taken control of the party’s finances after revoking signing authority from party officials, including the treasurer-general and secretary-general.

He dissolved the strategic presidential team — which had secretariat and financial powers — with immediate effect.

“Any commitments, contracts, obligations or financial liabilities entered into by members of the dissolved strategic presidential team shall not be the responsibility of the MK Party ... [which] will not assume responsibility for any debts or financial obligations incurred without the party’s duly authorised approval,” the party said in a statement.

The financial pressure has also extended to the party’s public representatives.

According to the insider, Zuma had called on MK Party MPs and MPLs to pay their outstanding contributions to help the organisation meet its financial obligations.

In June, the MK Party announced through its treasurer-general’s office that all travel, accommodation, car hire and venue hire booked and funded by the organisation would be suspended.

In a letter to its structures, the party said that this was to allow the treasurer-general’s office to “focus on critical financial processes like debtor management, refining the budget and appropriate allocation of funds to ensure that the organisation remains financially viable”.

In July, Zuma announced a temporary freeze on the party’s bank accounts and stopped spending across its national, provincial and regional structures. He also revoked party officials’ signing authority pending a financial review.

In January, Zuma removed then treasurer-general Mpiyakhe Limba, stating that the party was in a “pitiful financial crisis”.

Zuma accused Limba of failing to raise funds. In a letter seen by the Sunday Times, he said this was partly because parliamentary accounts were not working effectively, with party structures in KwaZulu-Natal and the Eastern Cape lacking financial discipline.

“KZN principals presented to me the millions you have taken out of their accounts and promised to reimburse them, yet to date you have not done so,” he told Limba.

Attempts to reach the party’s national spokesperson, Sifiso Mahlangu, were unsuccessful.