Low-cost housing scandal

2011-11-19 18:24

Mpumalanga human settlement head David Dube has fired an ­official and suspended another in an unfolding scandal regarding R331 million in tenders.

It’s alleged that tender rules were flouted in an RDP housing tender given to connected politicians.  Dube fired chief finance officer Cyril Dlamini and suspended ­supply chain management director Lucky Monareng for speaking out about ­alleged tender corruption that ­included the housing project.

Dube awarded the contracts to 76 companies using a closed bidding method by selecting them from the supply database in the 2010/2011 ­financial year, according to documents obtained by City Press.

The Mpumalanga treasury ­department advised Dube in a ­four-page letter dated June 30 last year that tenders valued above R500 000 should be advertised for an open and competitive bidding process to take place, and warned that he might “set a wrong precedent for the province”.

Dlamini had given the same ­advice to Dube in writing on May 5 last year. Dube sits on the ANC provincial executive committee. Sources in government who saw the list of companies and directors said he awarded contracts to ­politicians, politicians’ and senior officials’ girlfriends, businesspeople and friends who ­belonged to his and Premier David Mabuza’s clique.

A source in the department said Dube tasked another politician ­Peter Nyoni – the Ehlanzeni ­regional deputy chairperson and the ­department social and rental ­housing director – to chair an ­evaluation committee that picked the ­companies.

The biggest beneficiary of Dube’s 5?631-house bonanza was Deebo Construction and Projects, which was awarded a contract to build 599 houses worth more than R33 million in Mbombela (Nelspruit) and Mkhondo (Piet Retief) municipalities. Deebo is owned by Dibo Mzobe, a distant relative of President Jacob Zuma and they both founded the Masibambisane Rural Development Initiative to develop poor communities.

Zuma, Mzobe and Mabuza launched the Deebo project in Mkhondo on November 6. Other companies linked to ­politicians and their associates that benefited from the projects ­included:

» Madumanyana Projects, which got 30 houses worth R1 million in Umjindi (Barberton). One of the company’s directors is local mayor Vusi Mashaba – well-known as a Mabuza ally; and

» Sivuthumlilo Trading, which has another Mabuza ally, South ­African National Civic Organisation Mpumalanga secretary ­Raymond Makamo, as its director. This company benefited from 50 houses worth R2.9 million in Mbombela.

Dube defended the closed bidding method as being condoned by both Treasury and the auditor-­general.
“The decision is in line with applicable relevant supply chain management prescripts as approved by National Treasury,” Dube said.

He denied that the contracts were awarded to companies linked to ­politicians and said they were allocated according to merit. Dube declined to comment about Dlamini and Monareng’s cases.

“(These matters) are all sub judice (as) disciplinary hearings are still pending,” he said. Dlamini and Monareng declined to comment.

Sources in the department said Dube was not comfortable with the duo’s no-nonsense attitude. Dube wanted Monareng ­transferred to a lower position as Ehlanzeni district manager, but he declined the demotion and ­approached the Labour Court.

“Dube made Monareng redundant by appointing another official to act in his position while he was still there,” a source said.
Dlamini was allegedly suspended for ­betraying the trust between him and Dube after agreeing to be a ­witness for Monareng.

Dube fired Dlamini on July 31 on a new charge of unlawful entry into government offices while on ­suspension. Dlamini went there during office hours to collect ­documents to prepare for the first case.  He is appealing the dismissal.

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