Skweyiya in tender tangle
23/03/2008 03:56  - (SA)  

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The wife of Social Development Minister, Zola Skweyiya, is a business partner of Mazwi Yako, a multi-millionaire whose company has raked in millions of rands from the minister’s department.

And Yako stands to benefit handsomely from a R70 billion tender to distribute social grants nationally if Cash Paymaster Services (CPS) succeeds in the tender that is being adjudicated.

City Press is in possession of documents that show that Thuthukile Skweyiya is a shareholder of Zondwa Mining and Zondwa Resources along with Yako.

Thuthukile Skweyiya denied this yesterday. She said she only remembered being invited to a meeting where she was to be allocated shares four years ago but, she said, she did not attend. The documents show she has five ordinary shares in Zondwa Resources and five in Zondwa Mining.

Zondwa Resources has 97 issued ordinary shares estimated to be worth R20 million. Skweyiya’s five ordinary shares translate to 4.85% of the company or about R1 million.

Serge Belamant, chief executive of Net1 Applied Technologies, a Nasdaq-listed company that owns CPS, says its empowerment partner includes a company called Born Free Investments 272. Born Free receives monthly payments of about R4 million from CPS. The payments are described as “professional fees”.

City Press is in possession of some of the invoices. Bank documents also show large transfers and withdrawals from the company’s FNB current account. CPS distributes pensions in Limpopo, KwaZulu-Natal, Eastern Cape and North West.

City Press has established that Yako resigned from his directorships of CPS in five provinces before starting Born Free.

While he was a CPS director, Yako was tasked to “canvass” for “credible” suitors for CPS’s empowerment in the provinces.

A source claims that the professional fees Yako receives through Born Free from CPS are, essentially, for “lobbying”, given Yako’s struggle “credentials”. The source also claims that Yako boasts of a “friendship” with the late SACP leader Chris Hani, former safety and security minister Steve Tshwete and Skweyiya – a friendship the latter strenuously denies.

CPS, along with other small black empowerment companies, is one of the main companies likely to be given a slice of the consolidated national social security tender.

Finance Minister Trevor Manuel announced last month that R70 billion had been budgeted for the country’s disabled, aged and children of poverty-stricken families.

Skweyiya’s department has been riven by controversy and legal challenges. It lobbied cabinet to decide if there should be one super tender for the country’s social security that is handled by the South African Social Security Agency (Sassa).

Sassa has assembled a team that has been adjudicating the national tender in the past few months. In the end, Sassa chief executive Fezile Makiwane, appointed by Skweyiya, must make a recommendation to him on which company to appoint.

The minister will then make a public announcement.

Those close to the process say Skweyiya is facing a “monumental conflict of interests”, given his wife’s relationship with a key member of one of the bidding companies. Sources also claim that Yako once employed Makiwane’s brother, whose name is known to City Press, in what was termed Born Free’s Cell C container business after the brother lost his job in 2005.

A source said: “What you have here is a chief executive (Makiwane) about to decide on a R70 billion tender between a company that once employed his brother and those that won’t (benefit). Like Skweyiya, Makiwane is hugely compromised.”

City Press is in possession of bank documents showing “loan” payments to the brother. Makiwane had not returned messages on his cellphone at the time of going to press.

Skweyiya’s spokesperson Lakela Kaunda said Skweyiya knew Yako “from exile, in the same manner that he knows many other young ANC members who went into exile. There is no special or social relationship with Mr Yako”.

In response to the fact that Yako’s CPS raked in millions from his department, Kaunda said the tenders were a matter for the provinces and Skweyiya could not have influenced the decisions.

Kaunda said Skweyiya did not play a role in the evaluation, adjudication and awarding of the social grants tender being adjudicated.

“It is an administrative process that is being handled by senior and capable officials, from relevant government departments who have the necessary expertise,” she said.

Belamant initially downplayed the amounts paid to Born Free. He said they were about R500 000 a month.

But when City Press read him one of the invoices for KwaZulu-Natal that amounted to R2.8 million, he said the payments varied from month to month.  But he denied that Born Free was paid to lobby, saying it did “real work on the ground” for its money.

For two weeks, Yako has evaded City Press. He finally sent us a letter from his lawyers on Thursday morning, which reads in part: “Kindly furnish us with specific details regarding the information that you seek and the documents that you would have our clients comment on. We will then take instructions from our clients and revert to you shortly.”

A list of 29 questions was sent to Yako’s lawyer, Cherie de Villiers-Golding, who failed to respond.

In a brief interview last week, Yako told City Press he had “nothing to hide”. But he could not explain what the professional fees were, saying he was at a ceremony in the Eastern Cape.