Only R49 000 was due to Bojanala District Municipality, however, a North West provincial department realised almost a month later that R134 million was “erroneously” transferred to the municipality instead.
This was the explanation that North West Cooperative Governance and Traditional Affairs (Cogta) MEC Gordon Kegakilwe gave this week in a meeting with Parliament’s select committee on cooperative governance and traditional affairs, water and sanitation and human settlement, chaired by China Dodovu.
Bojanala Municipality Mayor Fetsang Molosiwa and other officials, as well as the North West finance and Cogta departments were summoned to Cape Town by the committee this week to shed light into the controversial R134 million transfer.
The audio recording of that meeting has since been published online.
A forensic probe was initiated and the committee heard that a preliminary report had been published, which Kegakilwe said was “not saying good about the municipality”.
City Press reported this week that R134 million paid into the bank account of the municipality disappeared the same day and was possibly used to pay off service providers, if details contained in the municipal’s ledger account shared with the Hawks were anything to go by.
The ledger ostensibly shows how millions were used to pay for catering and the clearing of illegal dumping sites when the municipality was too broke to pay its workers.
Two wrongs, erroneous transfers and contravention of the law
Not only was the wrong amount of money transferred to the wrong recipient, but the committee heard that all of this was done in contravention of the Division of Revenue Act, which requires publication of such allocations in the gazette.
The committee heard that the R134 million allocation was neither published in the gazette for transfer to Bojanala or Rustenburg Local Municipality, and that the requirement of the act was only fulfilled after the transfer was complete.
North West Finance MEC Motlalepula Rosho explained that the money paid to Bojanala was meant to be transferred to Rustenburg Local Municipality, where it was “intended and allocated for the construction of 1 000 housing units at Lethabong Extension 2”.
How the error happened
According to Kegakilwe, there appears to have been a mix-up between two payments which were processed around the same time.
He said there was a R49 000 invoice for Bojanala to be processed, which he said was a “refund for a disaster-related issue”, and R134 million for Rustenburg.
Kegakilwe said that in the end Bojanala’s refund and Rustenburg’s housing project allocation were combined and transferred to Bojanala.
He said the total amount paid to Bojanala was R134 097 000.50.
This is more than 2 700 times more than what Bojanala was supposed to have had transferred into its coffers.
Kegakilwe said they had identified “two officials who signed payment certificates that went to the bank”.
Rosho – who is former MEC for Cogta and during whose tenure the erroneous transfer happened, before she was moved to finance after the national elections last year – said she was the one who spotted the error and alerted senior officials in the department.
That was exactly 29 days after the money was transferred and probably already in use by the Bojanala municipality.
It appears that Bojanala did not take any effort to contact Cogta on the unexpected chunk of money transferred to it.
The municipality was only alerted to the transfer, which happened on March 4 2019, on April 1 and only started making repayments in August.
It was already struggling to pay salaries at the time.
A call for swift action
Emphasis was made in the committee meeting that those investigating should cast their net wider.
Calls have now been made for the investigation to look into who processed the transfer, who approved it and who made the payment.
While he said there was a need for a thorough investigation that should reveal how the money “went into the municipality, left the municipality and went to companies”, and that those company owners should be identified, Kegakilwe told the committee that the transfer was a human error.
Members as well as North West standing committee on public accounts chairperson Job Dliso appeared not to be buying it.
Dliso believed the transfer was not erroneous.
He questioned how the processing of R134 million could have gone through several hands without one of them picking up any red flags.
“Four people can’t press the same the wrong button four times, and that’s why we don’t agree that this was erroneous. There are people responsible for pressing the button...
“The department only woke up a month later when it realised that a wrong button had been pressed. We want an investigation into why the money was transferred to Bojanala, why the wrong button was pressed, who is responsible. [We want to] follow the money to the end.”
Committee member Phindile Mmola called for swift action.
“People must be arrested. We’re not going to say it was a mistake when you gave people a R49 000 invoice and [Bojanala] got R134 million,” she said.
Member of Parliament Zukiswa Ncitha said: “One person can make a mistake but all the others who follow must pick up the mistake.”
Meanwhile, Dodovu said his committee had “instructed the North West provincial government and the Bojanala District Municipality to urgently investigate and institute consequences against those who participated in the irregular and erroneous transfer of R134 million into Bojanala District Municipality’s account”.