Accusations fly at crisis meeting

2011-12-10 19:29

“You’re on a fishing expedition!” That’s what Limpopo ANC spokesperson and Finance MEC David Masondo accused Finance Minister Pravin Gordhan and his team of being on. A tense crisis meeting between the cash-strapped province and the holder of the national purse turned ugly on Thursday afternoon at the Ranch hotel in Polokwane where they met to plot how to fix a near-bankrupt Limpopo.

The province requested an extra R1 billion, over and above its R750 million overdraft facility, from the national Treasury to pay employee salaries and its suppliers after it ran out of cash.

City Press was told by a source who attended Thursday’s meeting that Masondo accused Gordhan and his colleagues of a “fishing expedition to get Julius and Cassel”. Gordhan led the national delegation.

Masondo refused to comment when asked about the remarks, but released a statement yesterday on behalf of the ANC, saying the party was “deeply worried that it was not consulted before the decision to usurp power from the provincial government was taken.”

Both Gordhan and Treasury director-general Lungisa Fuzile have flatly denied that the intervention was politically motivated.

It is not clear whether the crisis would hurt Mathale’s chances of being re-elected as ANC provincial head at next weekend’s elective conference. He will face off against Deputy Arts and Culture Minister Joe Phaahla, who is challenging him for the chairpersonship.

The province is seen as the base for those who want to topple Zuma at next year’s national ANC conference in Mangaung.

Public Works Minister Thulas Nxesi swiftly took over executive powers at the Limpopo public works department this week.

Nxesi said he would meet Limpopo Public Works MEC Thabitha Mohlala and her officials tomorrow and would decide on the processes to be followed once he knew the “gravity” of the situation.

The relevant national ministers have also taken over the provincial treasury, roads and transport, health and education departments.

Fuzile told City Press that the national Treasury had decided to intervene after the province’s unauthorised expenditure had ballooned to R2.5 billion and the province had requested extra funds.

Fuzile said meddling in the running of the province was necessary to avoid a total collapse of service delivery.

“There is evidence to suggest that there are departments in Limpopo that may have got more cash in their bank accounts than they needed at any given time, while on the other hand the treasury was in deficit at the same. Now that’s not good cash management.

“We’ve got to go there, work with the provincial treasury personnel to strengthen treasury, and work with the executive to reinforce the capacity of the treasury so that over a period of time we can work ourselves out of the system,” he said.

Limpopo spent an additional R1 billion irregularly in the 2010/2011 financial year, according to the latest auditor-general report.

The auditor-general found that irregular expenditure by provincial departments ballooned to R1.1 billion from R6.5 million in the last financial year.

Fuzile denied that the intervention had anything to do with politics, saying it had followed top-level meetings where risks were identified and provinces were asked to go back and implement remedies. He said when the provinces reported back it was clear that some departments had not done as well as others.

“They (Limpopo government) themselves came to us to ask for assistance in cash. It is a coincidence, in my opinion, that the date on which they ran out of cash happened to be a particular date in some people’s view that seems to suggest that there may be some political agenda.

“Think hypothetically of a situation where they come and we don’t have cash. There would be a storm in the province because when civil servants don’t get paid, they wouldn’t take kindly to that. It would mean that government is unable to honour the contracts it has entered into (with businesses) in terms of paying those people for services rendered,” he said.

Fuzile also dismissed suggestions that the inter-vention had anything to do with reports of irregular tenders in the provincial government.

But he said his department would not hesitate to act if aspects of irregular tenders and financial management surfaced.

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