Inflated pricing and shoddy renovations cost VUT R5.6m: Report

Vaal University of Technology. Picture: Supplied/VUT
Vaal University of Technology. Picture: Supplied/VUT

Every basin tap was loose, shower tiles were cracked and there were visible gaps between marble slabs and wall tiles.

These were findings made by BDO (Pty) Ltd investigators while inspecting work done by Lucky S Nhlapo (LSN) Trading, which was contracted to refurbish a student town for the embattled Vaal University of Technology at the cost of R5.6 million.

City Press has seen a confidential draft report on infrastructure project procurement and implementation review dated May this year that also found that LSN Trading was awarded the project irregularly without following supply chain processes.

The BDO report recommended that disciplinary action be taken against two university officials, Lawrence Tebobo and Jannie Morotolo, for their role in the awarding of the project to LSN Trading.

City Press has learnt that BDO was scheduled to complete the final report this year, and this was confirmed by BDO spokesperson Genea Tehini.

“However, it would be considered inappropriate and irregular for us to comment on matters regarding our clients due to the confidential nature of our business. As such we refer you to the client, VUT, who may be able to respond,” Tehini said.

VUT spokesperson Mike Khuboni referred questions to Professor Piet Swanepoel.

Swanepoel said he did not get the copy of the BDO report and, as such, was unable to respond.

LSN Trading managing director Lucky Nhlapo referred questions to his lawyer, Zola Majavu of Majavu Attorneys.

Majavu confirmed that LSN Trading was his client but distanced himself from the BDO matter.

“They came to see me to recover money due to them [owed by VUT]. I wrote to the university to propose a meeting. I refuse to be drawn into other issues that I wasn’t briefed about.”

Sources told City Press this week that the report was a sample of an investigation that was needed to be done into R37 million that the university allocated to infrastructure projects last year.

They said this was part of the reason Higher Education, Science and Technology Minister Blade Nzimande appointed former University of Johannesburg vice-chancellor and principal Ihron Rensburg on Monday with “immediate effect” as the administrator for the university.

Rensburg’s appointment effectively ended Professor Gordon Zide’s role as the vice-chancellor at the university and dissolved its council.

Nzimande had sent a letter earlier this month to the then university council announcing his intentions and requesting them to give reasons why he should not go ahead with his plan to appoint an administrator.

Nzimande’s predecessor, Naledi Pandor, had appointed seasoned academic Professor Barney Pityana as an independent assessor tasked with investigating governance, financial management, procurement practices and human resources management challenges dogging the institution.

According to the BDO report, the university paid nearly R5.7 million for additional work – alterations, carpentry, joinery, ironmongery, tiling, glazing, plumbing and drainage and paint works.

LSN Trading worked on the project between July and August last year.

Some of the work include renovations in kitchens at Boiketlong, Dinaleding, Melodine, Kutlwanong and Khomanani residences.

The report said LSN Trading may have also inflated prices charged for items when comparing its quotes with those that are offered commercially.

Some of the examples cited in the report include:

  • For a 15mm chromium-plated basin mixer, LSN Trading quoted R1 800, but it can be bought for R699 commercially;
  • For a 15mm chromium-plated under-tile shower mixer, LSN Trading quoted R1 800, but it can be bought for R585 commercially;
  • For a 15mm flexible connector, LSN Trading quoted R125. It can be bought for R27 commercially;
  • For a 15mm shower rose, arm and wall flange, LSN Trading quoted R600. It can be bought for R147.82 commercially; and
  • For a 15mm tap, LSN Trading quoted R900 but it can be bought for R152.17 commercially.

In addition, the report said “a calculation error or intentional misrepresentation” of nearly R1.4 million was identified mainly relating to the Student Town bathroom refurbishment upon verifying the totals from the quotes and invoices LSN Trading provided.

Whatsapp messages from Jannie Morotolo expressing how "excellent" the work was.

Other findings were that:

  • There was no purchase order, contract, quantities or specifications approved by VUT procurement for the additional work done;
  • The quotations and invoices for the work were only issued after completion of the project;
  • Based on the photographic evidence, work done by LSN Trading was completely inferior to any acceptable standard;
  • No evidence could be gathered to prove that the electrical work was signed-off by a legally competent person;
  • Specifications for tiling and glazing for kitchen refurbishments were vague and that if inappropriate specifications, which could result in new installations not achieving their intended lifespans; and
  • There were no drawings provided as part of the tender or contract.

The report also said there was lack of quality control during the execution of the project.

“In a WhatsApp message from Jannie Morotolo to Lucky Nhlapo (September 3 2018), Morotolo stated that the work done by LSN Trading was ‘excellent’. This was either an intentional misrepresentation of the quality of the work done, or Jannie Morotolo never went to site to inspect the works,” the report said.


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