Mpumalanga officials successfully pull off R300m looting spree

The Auditor-General found billions in terms of irregular expenditure in Mpumalanga. Picture: iStock
The Auditor-General found billions in terms of irregular expenditure in Mpumalanga. Picture: iStock

Mpumalanga officials who manned a “rogue tender unit” that hijacked infrastructure tenders worth R300 million seem to have pulled off their looting spree successfully.

Even though the Auditor-General found that none of the projects that the Rapid Implementation Unit handled about three years ago followed procurement procedures, no investigation was conducted in order to sniff out the miscreants as the Auditor-General recommended.

The Democratic Alliance (DA) is now accusing Premier Refilwe Mtshweni of covering up the Rapid Implementation Unit’s looting by ignoring the Auditor-General’s finding of irregular expenditure to the value of R300 million.

The Rapid Implementation Unit was established by former Mpumalanga director-general, Dr Nonhlanhla Mkhize, following a cabinet resolution to remove bottlenecks and expedite delivery of infrastructure projects such as RDP houses, schools, roads and clinics.

Mkhize appointed officials from various departments and stationed them in the office of the premier.

The Rapid Implementation Unit members did not follow competitive bidding processes when they appointed companies and they simply handpicked them from a database they created themselves irrespective of how much the tender was worth.

The Public Finance Management Act demands that tenders valued above R500 000 should be advertised for an open bidding process to take place while for those below the amount, three quotations must be sourced.

The unit, as the Auditor-General found, flouted supply chain management policies and contributed 13% of Mpumalanga department’s overall irregular expenditure of R2.4 billion in the 2014/15 financial year.

“None of the projects we tested that had used the Rapid Implementation Unit as a procurement agent had followed all supply chain management prescripts, which led to the irregular expenditure of R300 million by user departments and the department of human settlements,” the Auditor-General report said.

The Auditor-General also recommended that the irregular expenditure should be investigated to find out why supply chain processes were not followed.

“Transgressors should be brought to account in line with requirements of the Public Finance Management Act,” said the report.

No investigation was ever done and no action official was taken against the Rapid Implementation Unit officials.

The DA asked Mtshweni for an investigation report into the irregular expenditure on July 11 and also asked legislature speaker, Violet Siwela, to investigate Mtshweni for misleading the legislature when asked about the Rapid Implementation Unit.

Mtshweni told the legislature in May that the Rapid Implementation Unit had long been discontinued but boasted about its good work and said that it followed all supply chain management processes despite the Auditor-General’s findings.

“I must say that our capital projects were completed in time because of Rapid Implementation Unit. The unit no longer exists,” Mtshweni said.

Mtshweni’s spokesperson, Zibonele Mncwango, has declined to respond to City Press’ questions over the past three weeks.

Legislature spokesperson, Zamagambu Gumede, also did not respond to questions that sought to ascertain if Siwela had investigated the DA’s complaint against the Premier.

A source within the Mpumalanga government who has inside information of how the Rapid Implementation Unit operated said that the unit was a good initiative, but unscrupulous officials turned it around to benefit themselves.

“The unit resided in the office of the premier. What is wrong about this is that this department does not implement projects but oversee them.

"Since this office had no contractors, they handpicked them and created their own database,” the source said.

“Now, the Rapid Implementation Unit would appoint contractors on behalf of departments and no competitive bidding process whatsoever took place.

"The Auditor-General asked for tender documents but did not get them.

"The situation was worse in the Department of Human Settlements because the Rapid Implementation Unit appointed contractors on projects that had already been allocated contractors,” he said.

The source said that the Rapid Implementation Unit team would go on site to monitor projects and approve invoices themselves.

“They just looted as they pleased,” he added.

The latest Auditor-General report puts Mpumalanga government’s irregular expenditure at R11.2 billion, and raises a concern that the province cannot investigate this problem.

“The province has not yet mastered the art of properly investigating irregular expenditure previously identified, as more than 70% of the current year’s irregular expenditure arose from old multi-year contracts that had not been investigated.

"As a result, the closing balance of irregular expenditure increased to R11,2 billion,” says the 2016/17 report.

Sizwe sama Yende
City Press
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