IEC lease: Pansy Tlakula, 2 others should be held responsible, PwC probe finds

2014-03-18 13:03

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Independent Electoral Commission chairperson Advocate Pansy Tlakula, her suspended deputy Norman du Plessis and the then manager of her office, Stephen Langtry, should be held responsible for the roles they played in the controversial R320 million lease deal for the commission’s new offices, a forensic investigation by PwC has found.

City Press can reveal that Tlakula refused to cooperate with the IEC-sanctioned probe, citing the legal action she has taken against Public Protector Thuli Madonsela, who recommended that Parliament consider taking action against Tlakula for her “grossly irregular” role in the lease deal.

The PwC report also shows a number of instances where the bid adjudicating processes and criteria were changed “for the benefit of Abland” in which Tlakula’s company had a stake.

The 255-page PwC report was published on the IEC website this morning and shows that Tlakula’s new office in Centurion underwent a staggering R900 000 furniture facelift.

The PwC report has questioned the R900 000 spent on Tlakula's office and says that it “appears little or no regard was given as to whether these items were really required”.

The forensic probe also found that Khwela City, one of six bidders disqualified in the tender bidding process, could in fact have been awarded the tender but this was not done as information regarding Khwela City’s bid was “incorrectly stated” by Langtry, resulting in the company's disqualification.

“We determined from ... analysis that there were a number of instances where the information recorded by Mr Langtry in his (bid) evaluation spreadsheet is incorrectly stated, and based thereon, we believe that a bidder who ought to have been considered, and probably awarded the contract, was in fact Khwela City who [was] not even considered as meeting some of the Electoral Commission’s requirements, and as a result, [was] not shortlisted and invited to do [a] presentation to the executive committee on 19 June 2009,” said the PwC report.

The investigation also found that had Khwela City been awarded the tender, the new offices would have been “cheaper” to rent for the IEC.

“Had Khwela City not been disqualified, as a result of errors by Mr Langtry that were not identified by EXCO, and had they also been given the benefit of the amended occupation date, they (Khwela City) would have scored higher points than Abland in terms of the PPFA and they would have been cheaper,” said the report.

The PwC report found that the Preferential Procurement Policy Framework Act (PPPFA), which governs public tenders, was not adhered to as Abland was awarded tender points on its “black ownership” status despite the fact that the company only acquired black ownership after it was shortlisted for the tender.

At the time of the completion of the report, PwC said Abland had not furnished investigators with a copy of the agreement between Manaka, a black arm in the consortium, and Abland.

“At the time of issuing this report we have not had sight of the agreement between Manaka and Abland referred to (by Abland) but confirm that when interviewed the Abland representatives stated that Manaka had not purchased their share in the Riverside Office Park Trust for cash, but that Abland and other entities involved had stood as surety for funds borrowed from financial institutions to do the development,” said PwC.

Tlakula has a business relationship with Parliament’s finance portfolio committee chairperson Thaba Mufamadi as co-directors of Lehotsa Investments, which owns 20% of Abland.

The PwC report also found that the lease agreement was signed by Tlakula on August 21 2009 “even though the tax clearance certificate for the members of the Abland Consortium are, in two of the five instances, dated after this”.

The PwC investigation also “concluded” that the evaluation of the ten bid proposals received for the lease was only done by Langtry instead of the EXCO.

While Abland had changed the date on which the IEC could move into the office in Menlyn from April 1 2010 to August 1 2010, which PwC says should have disqualified it from the bidding process because of the urgency of moving into new offices, Abland was not disqualified.

“The IEC’s EXCO in a meeting on 19 June 2009, chaired by Advocate Tlakula, shortlisted after presentations by four bidders, Abland and Menlyn Corporate Park. This was despite the fact that Abland had now changed the date by which occupation would be given to 1 August 2010 from 1 April 2010. Menlyn Corporate Park [was] still able to keep to 1 April 2010, which was one of the key criteria of the initial assessment as given the pending municipal election in 2011 a later date would be problematic.

“EXCO effectively changed the criteria for the benefit of Abland part way through the process without offering the same benefit to other bidders that had been disqualified earlier in the process,” said the PwC report.

“Tlakula, as the Chief Electoral Officer and accounting officer, Mr Du Plessis as the deputy chief electoral officer: corporate services and Mr Langtry as the manager in the office of the CEO should each be held responsible for the roles they played that resulted in a procurement process being followed that was not fair, equitable, transparent, competitive or cost effective,” the report found.

Tlakula could not immediately be reached for comment.

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