Malema's tender bonanza

2011-08-07 11:22

Johannesburg - A company partly owned by ANC Youth League president Julius Malema’s family trust benefits ­directly from multimillion-rand tenders it helps to award.

Limpopo outsourced essential government functions to the ­company, which means it is ­engaged in the privatisation of state functions. Malema promotes nationalisation.

City Press can reveal that ­On-Point Engineers (Pty) Ltd - a private company headed by Malema’s former business partner, Lesiba Gwangwa, in which Malema’s Ratanang Family Trust owns a stake - cashes in on ­Limpopo road tenders it is ­supposed to manage.

On-Point was awarded a R51m tender by the Limpopo roads and transport department in 2009 to design, manage and ­implement road projects in the province through an outfit called the “project management unit”. This is outsourcing, a form of ­privatisation.

As part of the tender, On-Point’s duties include supporting the ­department with the adjudication and awarding of road tenders.

Confidential agreements

A document in the possession of City Press reveals that On-Point’s involvement in state tenders doesn’t stop there. The company also signs confidential “back-to-back” agreements with successful contractors, giving it a share of between 50% and 90% of the profits of tenders it helped to award.

The details of these back-to-back agreements are contained in confidential memorandums of ­understanding, signed between On-Point and contractors to the department. City Press has a pro forma memorandum that is used.

The parties are barred from sharing any information about the agreements with third parties.

“Any information shared by the service provider with the National Treasury will be shared on a statistical basis and no names will be made known unless the express written consent has been obtained from the person whose name is to be made known,” reads one of the clauses.

A National Treasury employee said that government could not outsource functions like this and it appeared that this clause violated constitutional provisions of transparency. Both this person and a businessman who ­understands the tender system said the back-to-back contracts were illegal and On-Point was ­conflicted as it could not be both tender referee and beneficiary.

Malema admits owning shares

Two company insiders, three youth league leaders, four business people, two senior civil servants and a provincial ANC leader told City Press that the confidential contract with On-Point was a requirement for any firm that wanted to benefit from projects overseen by the project management unit that the company manages.

On Friday, the Mail & Guardian reported that Malema admitted to owning shares in On-Point through the Ratanang Family Trust, of which he is a co-trustee. The other trustee is his grandmother, Sarah.

“Yes, we are close to On-Point. We are shareholders as a family,” Malema told the paper, declining to elaborate on the extent of the trust’s shareholding. He said he had not influenced any of On-Point’s tenders, adding: “I just queue when the dividends are due.”

According to the firm’s website, On-Point and, by extension, Malema’s family trust have benefited from at least eight other ­government tenders, excluding the project management unit ­contract.

This includes the construction of a high school, the upgrading of roads from gravel to tar and sewer reticulation in the Mopani District Municipality.

Growing enterprise

City Press can reveal that On-Point is a growing enterprise. It was recently appointed by the ­provincial local government and housing department (run by ­Clifford Motsepe, a close Malema ally) as consulting engineers on a low-cost ­housing project near ­Seshego.

In September 2009, City Press reported that Limpopo roads and transport MEC Pinky Kekana had suspended R300m worth of roads tenders and frozen Roads Agency Limpopo’s R1.2bn budget before firing the agency’s board.

Kekana later transferred the R500m maintenance budget of Roads Agency Limpopo (the provincial parastatal overseeing Limpopo’s road network) to a project management unit that is run by On-Point.

A National Treasury source said this might be illegal.
 
Malema’s admission of shareholding in On-Point again raises questions about the true purpose and administration of the Ratanang Family Trust, whose sole ­purpose is to look after the interests of Malema’s 5-year-old son.

Read more on:    ancyl  |  julius malema  |  lesiba gwangwa  |  pinky kekana  |  clifford motsepe  |  corruption
NEXT ON NEWS24X

Road deaths on the rise

2014-12-22 23:39
SHARE:

Read News24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
252 comments
Add your comment
Comment 0 characters remaining
 

Inside News24

 
/News
 

Five wrapping hacks you have to know before Christmas

Five gift wrapping hacks that will save Christmas for you!

 
 

I love summer.24

Sexiest Instagrams of 2014
Joburg hot spots for cocktails, craft beer, tapas and wine!
Summer Survey!
Great ideas for the best summer sandwiches!

Jobs in Cape Town [change area]

Property [change area]

Travel - Look, Book, Go!

Kalahari.com - shop online today

Grand Theft Auto 5

Now available on PS4, Xbox One and PC from R649. Buy now!

Festive gifts!

Check out our awesome range of festive gifts to make everyone’s wishes come true. Shop now!

Save on Samsung

Cameras, mobile phones, TVs, Tablets and more. While stocks last. Shop now!

Save up to R2200 on electronics! – As seen in the catalogue

Wishing for tech gadgets this festive? Save up to R2100 on hot tech products at kalahari.com. While stocks last. Shop now!

30% off the bestselling books

Save big on the most captivating reads of 2014. While stocks last. Shop now!

OLX Free Classifieds [change area]

Samsung Galaxy s4

Mobile, Cell Phones in South Africa, Western Cape, Cape Town. Date October 24

Best bargain in big bay

Real Estate, Houses - Apartments for Sale in South Africa, Western Cape, Cape Town. Date October 25

VW Golf 6, 1.6 Trendline (Excellent condition)

Vehicles, Cars in South Africa, Western Cape, Cape Town. Date October 25

Horoscopes
Aquarius
Aquarius

It is hard to keep some sort of balance when the natural rhythm has flown out the window. The best thing to do is try not to keep...read more

There are new stories on the homepage. Click here to see them.
 
English
Afrikaans
isiZulu

Hello 

Create Profile

Creating your profile will enable you to submit photos and stories to get published on News24.


Please provide a username for your profile page:

This username must be unique, cannot be edited and will be used in the URL to your profile page across the entire 24.com network.

Settings

Location Settings

News24 allows you to edit the display of certain components based on a location. If you wish to personalise the page based on your preferences, please select a location for each component and click "Submit" in order for the changes to take affect.








Facebook Sign-In

Hi News addict,

Join the News24 Community to be involved in breaking the news.

Log in with Facebook to comment and personalise news, weather and listings.