Millions of rands wasted

2010-07-31 11:57

The Road Traffic Management ­Corporation (RTMC) has wasted millions in mismanagement, ­irregular procurement and overexpenditure, Transport Minister Sibusiso Ndebele has said.

Ndebele said this week one of the key findings of an investigation into allegations of mismanagement was an irregular lease agreement of R658 million over 10 years, which resulted in an actual loss of R11 million.

“The ­total value of confirmed ­irregular expenditure... incurred at the RTMC is currently estimated at R144 million,” said Ndebele.

A task team was appointed in February to investigate allegations of mismanagement and issues ­relating to leadership, governance, business and finance at the RTMC under former chief executive ­Ranthoko Rakgoale.

“Mr Rakgoale was subsequently suspended and Collins Letsoalo, deputy director-general – financial services at the department of transport – was appointed acting CEO,” said Ndebele.

Riah Phiyega, who chaired the team, outlined the report, saying ­allegations included that eNaTIS transaction fees were used to fund overexpenditure, irregular purchases of IT “infrastructure” (R11 million) and an accident reporting ­system (R85 million over a two year- period). The project was stopped, resulting in a confirmed loss of R65 million.

It was also alleged there had been irregular contracting of suppliers for an IT help desk and internet management system amounting to R9 million. The team confirmed that R300 million of the eNaTIS fees were used to fund overexpenditure.

“This money was not stolen. The findings relate to not following directives to transfer money to the department, and knowingly using dedicated resources ­inappropriately,” said Phiyega.

The report also confirmed irregular spending of R9 million on the hosting of an international conference in Cape Town.

Other findings included the unauthorised expenditure of R1.4 million, as well as VAT abuses. Unnecessary financial management services amounted to R13.3 million.

The report also partially confirmed the ­irregular contracting of suppliers for R3 million, for the evaluation of electronic vehicle identification technology of which the deliverables were questionable and the awarding of a bid of R34 million for an ­enterprise ­resource planning system which was inappropriate for a corporate the size of the ­RTMC.

The report also made several corrective recommendations, which ­included a review of the RTMC Act and steps to be taken to rectify a funding shortfall in the organisation.

Letsoalo said besides Rakgoale, two other employees linked to these irregularities, were suspended , while another was put on ice for a separate matter.

Ndebele said: “Those found guilty of such offences are liable on conviction to a fine, dismissal or imprisonment.”

He would not say how many employees were implicated as disciplinary proceedings had yet to take place.

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