The minister said he was investigating whether public funds were diverted to people to create a “war chest”.
Briefing the portfolio committee providing oversight over Cogta, Van Rooyen told MPs his office was investigating the reports that a company linked to Leon was awarded a “half billion” contract.
“That is the allegation I'm following up,” he said.
It was reported last month that Resolve Communications, headed by Leon and Nick Clelland-Stokes, were awarded a R650 000 contract in November to improve the City's communication regarding the drought.
But the DA's Kevin Mileham took Van Rooyen to task for his claims of a “half a billion” contract.
“The minister got the numbers completely wrong,” Mileham said.
The minister retorted that those were allegations he was to investigate regarding the tender.
“I still have to probe them. We need to probe who is to benefit.
"Are we giving people money to create a war chest or deal with real issues affecting people?”
The minister also took a swipe at the Western Cape government for spending a quarter of R74.8 million allocated to it last August for drought relief.
“We requested this money from the emergency grant and now six months down the line, the province has registered 24% in expenditure,” Van Rooyen said.
“This expenditure trend undermines the purpose of the intervention and now it's even compounding the matter because we're currently lobbying for more resources.”
Van Rooyen urged the portfolio committee to look into the low expenditure trend in the DA-led provincial government.
“I think it is a concern the committee should entertain.”
Mileham came to the defence of the provincial government, saying it could not initiate tender processes without a guarantee for funding.
He told Van Rooyen that projects took a while to roll out and payments were made in phases.
“You don't release money for upfront for work done,” Mileham said, adding that projects were not undertaken overnight.
Van Rooyen said he was unconvinced by Mileham’s argument on the low expenditure levels by the Western Cape.
ANC's Amos Masondo said there was a sense that drought was being politicised in the Western Cape.
Van Rooyen agreed that collaboration was needed in order to give confidence to the people.
"If we need to improve on how we collaborate, let's not bring politics,” he said.