How Limpopo was looted – the inside story

2012-07-14 16:20

Treasury to blame for collapse of administration

Nearly 40 criminal cases have been opened as a result of investigations into the collapse of Limpopo’s basic governing systems.

Arrests in these cases are imminent, says the man heading up a national government intervention in the stricken province, and he says more criminal cases will almost certainly be opened as investigations continue.

On December 5 last year, five departments in Limpopo were placed under ­administration by the national ­government.

Monde Tom, who was appointed by the national government to head the Limpopo treasury’s administration team, would not specify the departments or officials implicated by the current criminal cases.

Last week, Finance Minister Pravin Gordhan told Parliament that 19 of the criminal cases involved officials from the Limpopo health department.

Tom said the blame for much of the complete collapse of Limpopo’s administration could be laid at the door of the provincial treasury.

Treasury, he said, left departments to their own devices, allowing them to buck the system and break basic procurement rules.

Reports produced by Tom’s administrative teams have revealed:
» Open-ended contracts across departments, meaning companies could change terms and conditions as they pleased;

» Service providers were not managed, and “charged and priced what they liked”, Tom said;

» The department of health irregularly spent R167 million on bandages alone last year;

» The department of health is dealing with more than 300 malpractice cases, with claims totalling more than R320 million. These cases are mostly the result of a shortage of doctors;

» At least three major contracts have been cancelled outright because of suspected corruption;

» In the department of public works, most infrastructure projects were led by engineers who were either not qualified or not registered with professional bodies, as required by the Built Environment Professions Act of 2000;

» The administrator in charge of the provincial transport department, ­Mathabatha Mokonyama, said he found the department “in a state of paralysis and free-for-all after all systems had completely broken down”; and

» A team in the transport department is travelling around Limpopo, personally inspecting roads and similar projects to ensure the work has been properly done.

Dr Norman Mabasa, who was appointed health MEC in April, said his priority upon taking over the beleaguered department had been to stabilise food and medicine shortages.

With that process under way, he said, his next task was to give urgent attention to court challenges launched because of alleged malpractice in state hospitals.

“We have more than 300 cases with claims totalling over R320 million,” ­Mabasa said.

“Largely, such cases are as a result of the shortage of doctors. I’ve just approved the appointment of 88 doctors, which will go a long way towards reducing these cases.”

The health department’s administrator, Tiny Rennie, said that when she arrived in December she found there were no procurement policies in place.

Instead, the department was using the quotation system, which is used by government in emergencies or when there is a limited number of suppliers offering a particular service or goods.

“They used the Annual Exemption Circular, which gave them authority to bypass procurement policies. I had to stop that with immediate effect. They used the system to buy photocopying machines, printing machines, expensive medical equipment, surgicals, pharmaceuticals and other services.

“This is highly irregular and many of these quotes are now under investigation,” Rennie said.

She said the department was gradually being handed back and was now out of “crisis mode”.

In the public works department, it emerged that one service provider was overpaid by R43.5 million.

The administration team’s diagnostic report reveals that in 2006 the department contracted a company to compile its immovable asset register at a fee of R15 million, for 18 months.

However, early this year the administration team found out that the company had already been paid R58.5 million – without any work to show for it.

The documents also reveal the company was paid an upfront fee of about R500 000 three months before the contract even started.

The company has now hauled the department to court, demanding an additional R13 million.

Tom said all the departments under administration were now in the recovery phase.

“We are trying to focus and deal with a few critical problems of the many that have been identified. We have been able to arrest the bleeding of the provincial revenue fund.

“However, you can’t say that the ­system is ready to run on its own because of the current improvement,” he ­cautioned.

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