eThekwini cuts corruption

2013-08-29 00:00

CITY employees still doing business with the eThekwini municipality pocketed R2,3 million during the past financial year.

Some have since resigned, but those still employed will have to face disciplinary hearings for violating the Municipal Systems Act. However, there is no guarantee that the money will be recouped.

They may also all be charged criminally.

This was revealed in the city’s quarterly budget report, with city treasurer Krish­ Kumar saying that despite the fraudulent activities, the city had made progress in trying to stamp out corruption.

Kumar said in the 2011/12 financial year, companies owned by or linked to officials in the city were paid over R9 million. He would not reveal how many employees had been found to be benefiting from the irregular expenditure.

“City officials had continued to submit quotations for their own companies and they were awarded these tenders,” he said.

Kumar said the contract management and register system that came into effect on August 12 would put a stop to the fraudulent activity.

Since the release of the Manase report, which highlighted the issue of councillors and officials doing business with the city, the city has been at pains to prevent officials from doing business with the it.

The report revealed that 10 councillors and officials raked in more than R19 million from doing business with the city. Seven contracts were awarded to councillors’ companies, a direct contravention of the Municipal Supply Chain Management Regulation 44.

The report also revealed that a further 46 contracts valued at R5,4 million were awarded to council officials and an additional 124 contracts valued at R45,5 million were given to companies owned by officials employed by various other government departments.

The council had disciplined 38 employees for doing business with the city and the report suggested that 123 others should be investigated.

Kumar said there had been an improvement in the way the city dealt with conflict of interest matters since the release of the Manase report.

“I remain adamant that we will get an unqualified audit report from the auditor-general. The auditor is happy with the new system and measures in place,” he said.

The city’s prevention measures include: tenderers to submit signed declaration of interest form, a conflict of interest task team, and companies are required to be registered on a database.

However, DA caucus leader Zwakele Mncwango said he was concerned that the ANC was celebrating prematurely.

“The city should not be proud about the fact there is a decline. Instead we should have zero officials doing business with the council.

“Officials know the code of conduct. They signed and committed themselves to those codes. We have not fired any official before for such irregular conduct and unless people are dismissed they will continue disregarding policies.”

Abuse of staff privileges

Section 4 of the Municipal Systems Act, 32 of 2000, states that a staff member of a municipality may not use the position or privileges of a staff member or confidential information obtained as a staff member for private gain or to improperly benefit another person, or take a decision on behalf of the municipality concerning a matter in which that staff member or spouse, partner, or business associate, has a direct business interest.

Wasteful spend

The city has reduced the amount of irregular expenditure by 75% over the past two financial years. The amount has dropped from R1,2 billion in 2010/11 to R780 million in 2011/12 and R325 million in 2013.

Municipal act

Irregular expenditure is defined in section (b) of the MFMA as “expenditure incurred by a municipality or municipal entity in contravention of the Municipal Systems Act and which has not been condoned in terms of the act”.

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