The finances of the United Independent Front (UIF) came under scrutiny in an application heard in the Cape High Court on Monday. The application was brought by Neville Hendricks and Mzwandile Manjiya, who say they are the UIF’s deputy president and secretary general respectively.
They are seeking to overturn a decision to change the UIF constitution, and to block the appointment as MP of Ike Kekana, whom Hendricks describes as the UIF’s ”putative acting president”.
In written heads of argument presented to acting judge Dumisani Zondi on Monday, Hendricks’s advocate, Paul Tredoux, said the party’s finances are ”clearly in a mess”.
He said that in early July last year, Hendricks learned UIF staff had not been paid, and a day later the Independent Electoral Commission (IEC) notified the party it was suspending its statutory funding because of a lack of financial statements.
Hendricks discovered that about R80 000 had been paid to the UIF’s lawyers from the party’s constituency allowance. ”This payment was not work legal work done for the UIF, but was probably done for certain members during the floor-crossing period,” Tredoux said.
A report by independent auditors said the party had an accumulated loss of R62 500 for the six months ended March 31 last year. This was also the amount by which the party’s total liabilities exceeded its total assets. ”In other words, it is insolvent,” he said.
In his heads of argument, the UIF’s advocate, Lawrence Nowosenetz, said the party admits there were problems in financial management. However, it has taken remedial action.
”It is a new party and should be given time to sort out internal difficulties,” he said, asking Zondi to dismiss the application with costs.
Kekana said in a telephone interview that the claim about IEC funding was wrong. ”There’s never [been] a day when the IEC suspended funding of this party,” he said. ”I am in control of the funds of the party. The National Assembly is giving us money; the IEC is giving us money. What nonsense is this?”
He said it is correct that the party was at one point R62 500 in the red, and that auditors gave a qualified report for the 2005/06 financial year. However, the party is not insolvent.
”Far from it,” he said. ”Where we are standing now, we are in a highly positive situation.”
Zondi said he will deliver a ruling on the application on April 24.
The UIF was formed in September 2005 during a floor-crossing window. It was headed by former United Democratic Movement stalwart Malizole Diko, who died in mid-2006. Kekana, a member of the Limpopo legislature, was to have taken Diko’s place in the National Assembly.
Monday’s application is one of five high court actions launched against the party by its own members since the beginning of August last year. One was withdrawn, one was dismissed with costs, and three have not been resolved. — Sapa