New charges of conflict of interest point to further irregularities in the province’s Housing Department, increasing the pressure for a full-scale commission of inquiry, write Justin Arenstein and Mungo Soggot
FRESH revelations surrounding the Mpumalanga housing scandal emerged this week, increasing the likelihood that the government’s current probe will be widened into a full-blown commission of inquiry.
A law firm bearing provincial housing chief Steve Ngwenya’s name -Steve Ngwenya & Themba Kwayo Attorneys – performs conveyancing work for the low-cost housing projects undertaken by his department.
It also emerged that the provincial Housing Department and the Provincial Service Commission have no official records for former provincial housing board chief Saaths Moodley.
He was paid from a special account, in an arrangement personally authorised by Ngwenya and no income tax was deducted.
The two officials are key players in the row which erupted last month, after the Mail & Guardian reported that Motheo – a company owned by a friend of Housing Minister Sankie Mthembi-Mahanyele – had landed a R185- million low-cost housing contract in the province. The project is the largest of its kind in South Africa.
The ensuing row has already cost Billy Cobbett, Housing Department director general, his job. Moodley, who authorised the Motheo deal, has resigned, and the auditor general is now investigating, with the help of forensic auditors.
Ngwenya and Moodley were unavailable for comment this week.
However, provincial housing representative Leon Mbangwa played down a potential conflict of interest in Ngwenya’s links to the law firm.
“Look, Themba bought the right to continue using Steve’s name when he joined the department because Steve is very popular and influential.
“You are just targeting Themba because he is black. Themba was clever enough to link up with Steve and use his name and that’s all there is to it. Housing applicants [the developers] have a choice to go to any other conveyancer or to this one, so there’s nothing wrong with it.”
Mbangwa denied that applicants could be swayed by the fact that Ngwenya was a highly visible public figure. Kwayo was unavailable for comment.
Sources close to the auditors probing the scandal surrounding Motheo said this week it was increasingly likely that the auditor general would recommend a commission of inquiry into the affair.
Such a step would allow investigators to subpoena some of the players, which would help establish the various cosy – and potentially conflicting – relationships that have characterised the deal. Records at Company House in Pretoria detailing Motheo’s list of directors have been removed.
The auditor general has contracted out the investigation to Johannesburg auditors Gobodo. Deputy Auditor General Professor Bertie Loots said it would be premature to comment.
Provincial Housing Department finance director Belinda Mojabelo said there was “something wrong with Moodley’s appointment. The proper channels weren’t followed and we didn’t get all the necessary information. We don’t even have his identity number.”
Neither the department nor the commission have the required records and identity numbers on their computer systems to legally pay Moodley.
Mojabelo said the department did not deduct income tax from Moodley’s salary during his two-year service on the province’s housing board and that “we cannot now deduct the necessary tax because he has left the department and we no longer have any power over him.
“It appears that Moodley was paid as a creditor and not as an employee or contract worker.
“You see, he was appointed as a politician and not as an employee.”
* Mpumalanga’s provincial legislature was to hear on June 13 the circumstances leading to Speaker Elias Ginindza spending R272 000 of state funds on his home.
An investigation into the provincial legislature, ordered by Premier Mathews Phosa last year, has also uncovered the disappearance of substantial numbers of computers, “massive” abuse of overtime claims and irregular staff appointments.
Ginindza says he was forced to carry out the alterations, including the installation of an electric gate, owing to police concerns about his safety. An audit priced the materials and labour involved at just R75 000. Ginindza now wants the builder to work for the legislature to make up the difference.
The investigation also found that Deputy Speaker Cynthia Maropeng has taken personal advances from the legislature worth R75 000 during the past eight months. Such advances are also being granted to other MPLs and junior staff.
Maropeng was allowed to repay the advances by running up additional travel and accommodation expenses. The expenses were then to be deducted from the advances owed.
The investigation found that Maropeng counted as one such expense an unspecified length of time staying at Cape Town’s Mount Nelson hotel, with her child and nanny.