Tender given to his wife’s uncle

2012-03-10 17:17

National Youth Development Agency (NYDA) boss Steven Ngubeni personally signed off on a R22 million catering contract that was awarded to his uncle.

City Press can reveal that the multimillion-rand contract to provide food to the so-called “Kissing Festival” – the controversial World Festival of Students and Youth in December 2010 – was awarded to the company of a police officer from Springs who is the uncle of Ngubeni’s wife – her mother’s brother.

After it was brought to his attention this week, Minister in the Presidency Collins Chabane said he would demand an explanation from the agency board. The NYDA falls under Chabane.

Ngubeni, a former ANC Youth League deputy secretary-general, refused to comment.

Ntombezintsha Trading – a company from Springs whose three owners include Musi Zondo, a police officer and the uncle of Ngubeni’s wife, Sarah Kubheka – won the catering tender. Proper tender procedures were not followed.

The company got R6.5 million upfront – but was fired only days into the festival when catering arrangements descended into chaos.

On Friday the organisation said if the company included a relative of Ngubeni’s, it was because he did not know about the business interest.

City Press first revealed the contract at the end of last year when a reader alerted us to the fact that the company was linked to Ngubeni.

Documents prove Ngubeni’s intimate involvement in the transaction with Ntombezintsha – including his signature on a contract and the authorisation of millions of rands of advance payments to the company.

These documents and hundreds others were obtained through access to information applications.

A letter issued in Ngubeni’s name, although signed on his behalf, informed Ntombezintsha it had won the deal.

The letter also shows that R6.5 million was paid as an advance.

The documents also clearly bear Zondo’s name, address and contact details and show Ngubeni’s approval of a multi-million rand advance payment.

The contract which bears Ngubeni’s signature includes another signature which appear to be the initials “M.Z”
Ntombezintsha was supposed to provide tens of thousands of meals over the 11-day festival.

Earlier this year City Press confronted Ngubeni and Zondo about their relationship, although at the time it wasn’t clear exactly how they were connected.

Zondo dodged the questions and Ngubeni simply ignored them.

Ngubeni and Zondo claimed that the R6.5 million was ultimately paid out to a group of about 20 small, local, youth-run catering operations.

Ngubeni said the agency had no choice but to ignore normal tender requirements after a management company originally hired to organise the festival walked away at the last minute.

The contract shows it was entered into with Ntombezintsha alone, while an invoice from Ntombezintsha shows only two companies and “youth groups” were listed as payees.

Ngubeni claimed he did not know who owned the “youth-run” caterers. He declined to answer any of the questions that were sent to him by City Press this week. “I reserve the right to respond to your questions at an appropriate time and forum, if needs be,” he said.

Zondo refused to say anything about either the tender or his relationship with Ngubeni’s wife and instead threatened to turn to his lawyers. A police spokesperson said they could find no record of Zondo declaring an outside business interest and they were investigating further.

The NYDA said Ngubeni had not been in a position to know if a relative was involved in one of the company’s given a tender.

It said in a statement that the “magnitude of the crisis” caused by the withdrawal of the company it had contracted to organise the festival had meant it had to deviate from normal tender processes and that this was allowed in law.

It had to scramble to hire a company at a time when many were closed for business in December. Ngubeni had to move to Pretoria in the run-up to the festival where he dealt with the paperwork relating to the contracts.

“All documentation, including that of the Ntombezitsha Trading CC-led consortium that the CEO signed from his temporary base in Pretoria purely referred to company names and not to the listings of directors’ names, and as such the CEO could not have been in a position to know who the directors are/were on signing contracts related to the Youth Festival.

“Given that the owner of the company is a distant relative of the CEO’s wife as you allege, there can be no reasonable expectation that he would know his business activities,” it said.

It said some of the documents had been signed by the acting chief financial officer, as the organisation’s policies allowed.

But late yesterday, NYDA board chairperson Andile Lungisa suddenly called to say that Ngubeni had noticed a potential conflict of interest days before the contract was awarded to Ntombezintsha and had alerted him to it.

Lungisa claimed a note had been made of this. Neither Ngubeni nor the board provided City Press with a copy of his alleged declaration as requested earlier in the week.

David Lewis, executive director of Corruption Watch, said that “even the appearance of an interest conflict in awarding a government contract should not be countenanced, particularly in an environment in which actual conflicts have become so commonplace and where, as a result, there is so little trust of government’s procurement procedures.”

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