R70m cash crunch over Mandela memorial spend

2014-03-16 14:01

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Mpumalanga’s government has shifted R70 million from six of its departments’ service delivery budgets to cover employees’ salaries after spending the money on memorial services for former president Nelson Mandela.

City Press has copies of bank statements that show R39.8?million of this was paid to celebrity event planner Carol Bouwer in the space of a week.

The company did not tender for the job – and the provincial government did not solicit quotes from any other event firms.

Three ANC legislature members who spoke on condition of anonymity told City Press the cost of six memorial services held around the province emptied the coffers of Premier David Mabuza’s office and there were fears that salaries would go unpaid.

They said the costs were too high and bemoaned the fact that money was taken from service delivery departments to benefit one individual.

While presenting his 2014/15 budget on Tuesday, finance MEC Madala Masuku tabled the Mpumalanga Special Adjustment Appropriation Bill to transfer funds to Mabuza’s office to make up the shortfall.

.?R10?million was taken from the social welfare services budget which is used to provide food parcels for the poor, and funds for charities supporting rape victims and child-headed households;

.?R5?million was appropriated from the public works, roads and transport department which may now come under pressure after roads and bridges were damaged by floods in the eastern part of the province in the past two weeks;

.?R41?million was taken from the cooperative government department;

.?R5?million was taken from human settlements; and

.?R9?million was taken from finance.

Provincial director-general Nonhlanhla Mkhize hired Carol Bouwer Productions to organise all its Mandela memorial events after the elder statesman’s death on December 5.

The largest of these, held at Mbombela Stadium on December 10, involved setting up a stage and sound system, organising TV screens for a live crossing to the national service at Joburg’s FNB Stadium, and hiring SA Idols finalists Brenden Ledwaba and Musa Sukwene to perform.

Smaller events included a service in Middelburg which was held in the town hall, and others in marquees in Ermelo, Bushbuckridge, Malalane and Mkhuhlu.

After the services were held, Mabuza’s office issued a statement saying an estimated 80?000 people had attended the events in the province.

Bank records seen by City Press show Mabuza’s office transferred the cash to Carol Bouwer Productions’ account in two instalments – one of R21?416?484.50 on December 12, and the other of R18?379?773.40 on December 19.

It’s not known where the marquees were hired from, but City Press called three event management companies in Mpumalanga that said a marquee seating 3?000 people would cost between R55?000 and R87?000, including chairs.

Each mourner in the marquee received a sandwich, an apple and a soft drink.

Bouwer did not respond to numerous requests for comment made over the past two weeks, and failed to answer calls to her cellphone, text and voicemail messaging service, or emails.

City Press left several messages with her colleagues in Cape Town from March 5 but received no response.

Mpumalanga government spokesperson Nonkululeko Mbatha had promised since March 3 to respond to written questions.

Despite numerous follow-up requests, she did not do so.

An ANC legislature member who spoke on condition of anonymity said finance department officials were reluctant to sign documents relating to the project.

“You could see something was wrong from the way they were lobbying reluctant officials in the finance department to sign for these payments. Most of them did not want anything to do with it because they feared it would backfire. Now service delivery has to be sacrificed for an event that benefited individuals,” the member said.

Another ANC legislature member who asked not to be named said: “Firstly, this was done very wrong, procedurally, and then the costs are unjustifiably high.”

Yet another ANC legislature member said: “This leaves one wondering how much was spent nationally if Mpumalanga alone spent R70?million. These are the kinds of expenditures that get departments in trouble with the Auditor-General,” he said.

Congress of the People MPL Zale Madonsela accused the provincial government of looting.

“They looted and then pushed this adjustment through so the Auditor-General cannot give the premier’s office a qualified report for unauthorised expenditure. They will definitely be short of money to pay salaries and will have to run an overdraft with the bank.”

The tender was granted to Carol Bouwer Productions on an emergency basis.

A senior Mpumalanga government official said: “An emergency allows a department to suspend competitive bidding, but a department should at least get three quotations or proposals from service providers. In this case (Carol Bouwer Productions) was appointed as if it was a single source (of events management service).”

Mpumalanga treasury spokesperson Letshela Jonas said Mkhize had the power to deviate from procurement procedures provided she had valid reasons for doing so and reported them to National Treasury and the Auditor-General.

“But I’m not privy as to whether they reported the deviation or not. You’ll have to speak to them to find out,” Jonas said.

Carol Bouwer Productions also featured in an investigation by Public Protector Thuli Madonsela, although she and her company were ultimately cleared of any wrongdoing.

Madonsela found that former Communications Minister Dina Pule gave an unsolicited R10?million “donation” to Bouwer’s company against Treasury regulations.

But the Public Protector found the company had “innocently” accepted the donation and used it to coordinate operations at the ICT Indaba.

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