FRIDAY, 4.00PM
AUDITOR-general Henri Kluever has called for a full-scale commission of enquiry to establish whether relatives or close friends of Housing Minister Sankie Mthembi-Mahanyele improperly benefited from the Motheo housing project in Mpumalanga.
An inquiry is one of the recommendations contained in a report on the auditor-general’s special investigation into the project which is due to be tabled in Parliament and the Mpumalanga legislature on Monday. Kluever found the cost of the 10_500-house contract awarded to the Motheo construction company had been inflated by R23,6-million and the Mpumalanga housing board had authorised an effective subsidy of R17_250 a house without the proper authority. Motheo is headed by Dr Thembi Ndlovu, a close friend of Mthembi-Mahanyele.
“It is evident that the interests of the taxpayer and the principles of good governance have not been served in this instance,” the A-G’s report says.
Other findings in the report include: The Mpumalanga housing board did not actually have the money it promised to Motheo when the the contract was signed. The province also had no prospect of securing the money, having already over-committed itself by R313-million. Former board chairman Saths Moodley never obtained proper approval for the scheme because there was no quorum at the board meeting where the matter was briefly discussed. While the Motheo proposal for the project had hinged on a supposed joint venture with Nedcor, no formal agreement between the company and the bank was ever concluded, and Nedcor vehemently denied being officially involved in the scheme. The board had agreed to pay Motheo an extra R930 a house or R9,7-million for bulk infrastructure, which it did not have the right to do. An effective R24,4-million interest-free loan was granted to Motheo. The report does not mention the dispute between former housing department director-general Billy Cobbett and Mthembi-Mahanyele, following Cobbett’s decision to ask the auditor-general to investigate the project. Cobbett subsequently lost his post and Moodley and fellow housing board member Job Mthombeni, a Motheo director, were asked to resign.