KZN MEC allegedly failed to act against corruption

2015-04-24 07:00
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Durban - The Co-operative Governance and Traditional Affairs Department was given evidence of rampant irregular expenditure and looting of public funds at the Harry Gwala District Municipality nearly a year ago, and allegedly did nothing.

KwaZulu-Natal MEC Nomusa Dube-Ncube’s office on Thursday insisted that if the details of a security tender awarded by the municipality - that was inflated by nearly 160% - are brought to its attention, it would call a wide-scale investigation.

“Any allegation of fraud or corruption within municipal structures will be viewed in a serious light and obviously this will be a cause for concern, because the reputation of a municipality and its leaders is on the line. Those allegations tend to erode the confidence of the people,” spokesperson Lennox Mabaso said.

“She [Dube-Ncube] needs the document and she will be glad to accept them and then she will act. We just need to be careful to not make allegations that will not stand the test of time. We need to have the evidence.”

Call for information

Mabaso appealed to anyone with information on corruption at the municipality to come forward.

“If anyone has information about this issue at hand, they must bring the information to the attention of the MEC, but they must also go to the police and open a case. We will not go on a wild goose chases. With the information in hand we will commit our resources to an investigation,” he said.

However, a letter by former Harry Gwala council speaker Mandla Ngcobo’s attorney, with an affidavit highlighting his concerns about the municipality’s tenders, was sent to Dube-Ncube’s office on July 24 last year. Its receipt was acknowledged with an official department stamp. However, no action followed.

News24 supplied Mabaso with a copy of the letter and affidavit, which he said he would investigate.

Ngcobo has revealed transactions the municipality entered into that he alleged were questionable, only to be disciplined by the ANC and brow-beaten into resigning as speaker. He is now an ordinary councillor.

‘Looting of public funds’

Last week, he wrote to President Jacob Zuma, asking him to have the Special Investigating Unit probe the municipality to prevent “the looting of public funds”.

A large part of his missive to the president centres on a security contract awarded after going out to tender. Ngcobo says the cost was inflated by R12m, taking the total cost to R22m. He also wants a R2.5m training contract probed.

Ngcobo, who declined to speak to News24, says in the letter that he raised his concerns before the council and tried to get a court order preventing further payment of the tender, to provide security at municipal offices, which almost doubled without reason.

The letter, which was leaked to News24, details alleged financial wrongdoing in the district administration.

“In the 2011/2012 financial year, a tender was awarded to a non-responsive service provider. The bid adjudication committee disregarded essential requirements in the bid document [and awarded the tender to a company which did not fulfil all the required criteria].

“There have been overpayments and fluctuation of monthly costs [to the security company] and an excess of payment of over R12m,” Ngcobo said.

According to a decision circular from the municipality’s chief financial officer, dated July 2011, the bid adjudication committee recommended the appointment of a certain company to provide security services for office buildings for three years at a total cost of R8 706 922 [R241 858 per month].

The tender was awarded despite the company not having public liability insurance and proof of a provident fund, which were key requirements.

Dramatic increase

According to a report by the National Treasury, the scope of the tender was dramatically increased a month after the contract was awarded, apparently to guard 12 waterworks sites. Within 30 days, the company went from providing 41 security guards to 95 on the same contract.

Using invoices submitted by the company, the Treasury found that the price per guard increased nearly 25% within a year, pushing the monthly rate to nearly R900 000 when the contract was finally halted in August 2014.

The original tender made no mention of the installation of CCTV cameras, but according to the report the municipality paid the company over R100 000 to install surveillance equipment over two years.

The company had been asked by the Treasury to submit details of the security guards employed at municipal sites. Records indicated there were fewer guards than had been invoiced for. This discrepancy was not explained.

The Treasury concluded the contract was inflated without authorisation. The company’s managing director referred all questions to the municipal manager.

Harry Gwala District officials, including the municipal manager, did not respond to questions sent repeatedly.

Read more on:    durban  |  local government  |  corruption

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