/ 2 November 2010

Water affairs suspends two officials

The department of water affairs suspended its chief financial officer (CFO), Onesmus Ayaya and acting director general, Nobubele Ngele, on Monday in connection with alleged irregular procurement practices running into millions of rands.

Ngele is deputy director general for corporate services — who has been acting director general since Pam Yako was suspended from the position last year — also because of alleged tender irregularities.

The department’s spokesperson Mava Scott said Ayaya and Ngele had been put on “precautionary suspension” pending an investigation into several breaches of procurement procedures. In a statement, the department said the Public Service Commission (PSC) was investigating instances of procurement malpractices.

The Mail & Guardian reported on a series of allegations involving widespread tender fraud between May and July. In May, auditor general Terrence Nombembe’s report found widespread violation of procurement policies in multimillion-rand tenders awarded by the department.

The department, now with a new minister, Edna Molewa, who was moved two days ago from Social Development by President Jacob Zuma, has made news headlines with allegations of “deals for pals”, particularly since Yako was suspended. She was found guilty by the AG of irregularly extending the contract to an information technology company, Arivia.kom, for 49 months — effectively inflating its value by 587%. The government’s procurement manual limits contract extensions to 12 months.

Running a business using tenders
Service providers have expressed concern to the M&G that the department has, in effect, been running a business using tenders.

No less than four senior managers have been implicated in the mess.

The AG’s report said Yako and the CFO Ayaya condoned irregular expenditures amounting to millions of rands. Another senior official — chief director for financial management of water trading — Zandile Mathe, is still under investigation regarding a multimillion-rand tender. She is facing allegations of frustrating the service provider for allegedly refusing to sub-contract some of her preferred service providers and a project manager, in a R72-million water efficiency project.

The department is now trying to restore its image as a service provider instead of a corrupt tender base.

“Given the seriousness of the allegations arising from both processes [the AG’s report and the PSC’s ongoing investigation], the department has thought it prudent to put them on precautionary suspension pending due process in this regard,” said Scott.

“The department wishes to place it on record that the two are not guilty of any wrongdoing and their integrity and innocence should be respected. The legal principle, ‘innocent until proven guilty’ applies wholly in this case”.

A departmental source told the M&G on Tuesday that at the heart of Ayaya and Ngele’s suspensions was that the two failed to intervene to ensure that due tender processes were followed, despite having the powers to do so.

The auditor general’s investigation into Yako has opened a can of worms and insiders have warned that more information is yet to come out on procurement malpractices in the department.