The abuse ends now

2012-01-29 10:55

Durban’s new city manager has vowed to clamp down on officials who misuse system

The axe is set to fall on eThekwini’s free spending housing and procurement bosses, who used emergency finance regulations to splash out more than R469 million in unauthorised expenditure during the 2010/11 financial year.

Durban’s new city manager Sibusiso Sithole has not only vowed to “come down hard’’ on officials who have “abused” the system, either through corruption or inefficiency, but also recover any money looted from city coffers from any officials responsible for signing off on dodgy payments.

Sithole, who last year oversaw the turnaround of the Umsunduzi Municipality after its collapse over political infighting and corruption, will also investigate companies who have benefited from multiple emergency grants and will strip them of any contracts awarded in an underhand way.

According to the latest report on the city by Auditor-General Terence Nombembe, which will be formally tabled at a full council meeting tomorrow along with the municipality’s annual report, city officials used Section 36 of the Municipal Finance Management Act to award “emergency’’ contracts worth R469 million without following proper procurement procedures.

The city’s housing department, long plagued by allegations of abuse of tender procedures and the granting of contracts to a small cartel of politically-connected companies, granted contracts valued at R577 million without authorisation. In total, city officials spent R1.3 billion irregularly without following proper procedures.

Sithole on Tuesday briefed the city’s Executive Committee (Exco) on the matter, saying he would not tolerate “abuse” of the emergency regulation. His administration would only allow use of Section 36 – which allows accounting officers to deviate from supply chain management regulations – in exceptional circumstances involving real emergencies.

Sithole also declared his intention to review all irregular expenditure between last July 1 and December 30 last year to prevent abuse during the current financial year, which ends on June 30.

In an interview with City Press on Friday, Sithole said Section 36 had been badly “abused” in the city and could no longer be used wholesale.

“We have to acknowledge that there has been abuse of Section 36, with it being used where there are no emergencies.

“It is also of concern that there has been an escalation in irregular spending in general, from just over R500 million to R1.3 billion. We think there is mischief somewhere,” Sithole said.

Procurement officials, he said, would have to explain the spending, much of which Sithole believes is a result of poor planning, particularly by the city’s housing department.

“In a sector like housing there are so many process to follow and so much planning required. How then can there be an emergency unless there is flood damage or some other kind of disaster?’’ Sithole said.

“In my view this is the result of poor planning.’’

“We need to revamp our project management processes so we can procure goods and services and advertise, evaluate and award in the proper time frames and get people to start work on time,” he said.

Sithole said his team would “come down very hard” on officials who could not explain expenditure and, where corruption was found to have taken place, recover the money and push for criminal prosecution.

“We will come down very hard on people and departments who have over the years been using the section in an abusive way. We will take action against them and recover what we need to recover from them,” he said.

He said that all irregular spending from July 1 to December 30 last year was already being audited to deal with it before the end of the financial year.

“We will make sure that the abuse of Section 36 is stopped by the end of this financial year. I, the mayor and the parties in council agreed that this needs to be reigned in and used only for the correct purposes. We will have Section 36 awards, yes, but only in the case of real emergencies,’’ he said.

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