Housing scandal man advising Sisulu

The man who presided over South Africa’s biggest housing scandal eight years ago is back — as special adviser to Minister of Housing Lindiwe Sisulu.

Saths Moodley resigned as executive chair of the Mpumalanga Housing Board in May 1997 as the Mail & Guardian exposed what became known as the Motheo scandal.

In subsequent reports by the auditor general and a provincial commission of inquiry, Moodley shouldered much blame for the irregular award of a R190-million low-cost housing contract to Motheo Construction, a company formed by a friend of then-housing minister Sankie Mthembi-Mahanyele.

Questions about the minister’s role remained unanswered. She failed in a R3-million defamation claim against the M&G after it implicated her in the scandal.

Moodley this week referred questions to Sisulu. She was in Brazil and could not be reached for comment, but her spokesperson, Thabang Chiloane, said: “I can safely say that [Sisulu] would have applied her mind to Moodley’s appointment.

“The minister would have given due consideration to Moodley’s wide national and international experience and would also have taken into account that she needed a candidate to match her own energy.”

Chiloane added that Moodley’s position was not administrative in nature and was unrelated to the awarding of construction contracts, as that was not a function of Sisulu and her ministry, but of the provinces.

Political analyst Richard Calland said special advisers were “lieutenants” to ministers. “They are appointed only where they are politically trusted by the minister. They enjoy … access that allows them to exert a considerable level of influence.”

Moodley appears to have a wide brief, but has taken a special interest in the N2 Gateway Project, the government’s most ambitious housing project to date. Sisulu has called it the “spearhead” of the government’s revamped Comprehensive Housing Plan.

N2 Gateway is a R1,6-billion fast-track effort to house tens of thousands of Cape Peninsula squatters. Moodley is the project’s -spokesperson.

Moodley joined the ministry in June last year, but has stayed on as chairperson of Webnet, an IT company he co-founded in 2000. His partners in Webnet include Granny Seape, another key player in the Motheo scandal.

In late 1996 and early 1997 when Moodley headed the Mpumalanga housing board, Seape, as head of affordable housing at Nedcor, helped put the Motheo deal together. Her sister, Thandi Ndlovu, headed the beneficiary company, Motheo Construction. Ndlovu was Mthembi-Mahanyele’s friend from exile days.

Seape quit Nedcor before the scandal became public. Company records show that Moodley joined Seape as partner in a “facilitation and lobbying” company, Ahanang Agency, in May that year — before his resignation from the housing board was announced.

He insisted at the time that he did not resign because of the scandal, but to pursue a new career.

Moodley’s teaming up with Seape came two months after he, on the housing board’s behalf, had -counter-signed the contract awarding about R190-million state funds to -Seape’s sister’s company. Motheo Construction was to build 10 500 houses in rural Mpumalanga.

An auditor general report in September that year ripped into the deal, saying the housing board had not properly considered Motheo’s application and had sanctioned funding millions of rands more than allowed. Moodley, although unnamed, was the implicit target of much criticism.

The Dreyer commission, appointed by then-Mpumalanga premier Mathews Phosa, later reported that Moodley had personally driven the deal at the housing board. It blamed him for a string of irregularities:

  • Insufficient information was provided to the housing board executive and the board to make an informed assessment of the Motheo application. From evidence, it appeared board members were unaware they were approving such a large deal — or any deal at all;
  • The board “approved” the deal without a quorum, meaning the contract was invalid;
  • Deficiencies in the contract itself.
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    Stefaans Brmmer
    Guest Author

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