Governance at Gauteng Liquor Board has collapsed, inquiry finds

The governance framework of the Gauteng Liquor Board (GLB) has collapsed to the point that consultants are running a parallel licensing structure in which they draft applications, manipulate files and orchestrate approvals, often in direct collusion with insiders.

These are some of the findings of an inquiry into the GLB’s affairs commissioned by Lebogang Maile, Gauteng’s former MEC for economic development, in June last year. The inquiry committee, led by former solicitor-general Fhedzisani Pandelani, submitted its report in November.

The inquiry found that licensing, the board’s core function, has become a procedural charade.

After reviewing hundreds of files, the inquiry committee found widespread violations of the Gauteng Liquor Act, which prohibits outlets within 500m of schools, churches or public facilities. Yet, it said, such licences were routinely issued — some within sight of playgrounds.

“Applications were approved without local authority consent, incomplete inspection reports, or missing public notices. Files were duplicated, inspection photographs reused, and records backdated to regularise unlawful activity,” the report states. More than 18,000 files remain undigitised.

The committee found evidence of deliberate manipulation: forged letters of no objection, duplicate receipts for renewal fees, and “ghost applications” processed through manual systems operating outside digital registers.

“This duality — both formal and illicit — has entrenched a culture of procedural theatre, where compliance is performed, not practised,” the report says.

According to the report, the inquiry convened 99 sessions — including formal hearings, focus groups, site inspections and community consultations — and more than 300 participants made written or oral submissions to it.

The GLB is an institution tasked with regulating the liquor industry in the province. It issues various specialised liquor licences allowing alcohol to be sold.

But the inquiry found the two-tier licensing model envisaged by the Gauteng Liquor Act — anchored on partnerships between the GLB, municipalities and local committees — has effectively collapsed.

“This failure has created a policy vacuum where zoning, bylaw enforcement and spatial safety planning are unco-ordinated. The result is a proliferation of outlets in residential and vulnerable areas undermining municipal developmental planning under the Spatial Planning and Land Use Management Act and [department of co-operative government & traditional affairs] frameworks.”

The enforcement arm of the GLB has collapsed, according to the inquiry, with fewer than 20 inspectors responsible for over 33,000 licensed premises — and an estimated 200,000 illegal ones.

Inspections are reactive, triggered by complaints rather than intelligence. Follow-ups are inconsistent, often influenced by personal interest or external pressure. This vacuum has allowed a culture of impunity to flourish, eroding community trust and undermining public safety.

“Inspections are reactive, triggered by complaints rather than intelligence. Follow-ups are inconsistent, often influenced by personal interest or external pressure. This vacuum has allowed a culture of impunity to flourish, eroding community trust and undermining public safety.”

The committee said its most alarming finding was the emergence of a parallel governance structure within the liquor licensing ecosystem — a network of unregulated intermediaries commonly referred to as consultants — who have assumed de facto control of licensing processes.

“They draft applications, manipulate files and orchestrate approvals, often in direct collusion with insiders,” reads the report. “In many instances, these consultants pre-select outcomes by exploiting procedural loopholes and bribing officials to ‘fast-track’ applications.”

The report describes the phenomenon as “regulation by stealth”, adding that it has transformed a statutory function into a transactional market. Its persistence was not accidental but systemic, sustained by the absence of internal compliance controls, conflict-of-interest registers and disciplinary mechanisms.

“The committee concludes that this capture has rendered large segments of the licensing process constitutionally suspect and administratively invalid. It is not enough to replace individuals — the entire architecture of control must be re-engineered.”

Without functional delegations of authority, a board charter or a resolutions register, GLB decisions are taken informally, recorded erratically, and often remain unsigned, the inquiry found.

Audit findings have been left unresolved across several financial years, audit trails linking decisions to documentation are non-existent, and oversight committees meet irregularly.

“The cumulative effect is a regulator that has lost institutional coherence, operating on discretionary authority rather than delegated power.”

Vuyiswa Ramokgopa, Gauteng’s newly appointed MEC for economic development, told the Sunday Times a process to digitise files was started under her predecessor, who left office on April 1. She added that the process of digitising the system would now be fast-tracked so that there were greater levels of transparency and efficiency in the licensing process.

Ramokgopa said she believed the proliferation of the “liquor consultants” was a result of inefficiencies in the GLB, where it sometimes takes 12 or 18 months to respond to applications.

“It may well be that your licence application failed,” she said. “If so, there should be a clear description [of] why it is failing and what … you can do to resolve the issues. But I think, because of our own challenges and inefficiencies [in] concluding some of these applications, it then creates the proliferation of or the need for these intermediaries, and they then become part of the broken system.”

On enforcement, Ramokgopa said the provincial government had started to interface with municipalities, law enforcement agencies and liquor inspectors to co-ordinate the ecosystem.

“The work is to make sure that local police stations, liquor compliance inspectors, liquor enforcers and licence issuers are operating more effectively and in a co-ordinated fashion. Currently, that’s not the case.

“Our liquor regulations are very clear. They say you cannot operate a liquor outlet within 500m of a church, school or any such establishment. But then you have municipalities that grant business rights and trading licences to entities that are quite clearly in contravention of the Liquor Act. It then becomes difficult for us to enforce.”