/ 26 August 2013

Pansy Tlakula’s IEC lease was irregular, says Madonsela

Pansy Tlakula's Iec Lease Was Irregular, Says Madonsela

The process followed by Independent Electoral Commission (IEC) chair Pansy Tlakula in securing a R320-millon lease for the IEC's head office in Centurion was "irregular … and violated procurement rules".

That was the ruling made by public protector Thuli Madonsela on Monday morning at the offices in question, where she released a report on an investigation into allegations of maladministration and corruption in the procurement of the Riverside Office Park in Centurion to accommodate the head offices of the IEC.

Madonsela has been criticised by opposition parties, which have suggested the investigation was dragging out and asked whether Madonsela was being selective in probing her close friend, Tlakula, City Press reported on Sunday.

But Madonsela came down firmly on Tlakula on Monday, much to the latter's dismay, and found Tlakula had not followed "her own commissions procurement policy", by running the procurement process herself instead of leaving it to the relevant departments. A ruling of maladministration for failing to follow treasury regulations was also levelled against Tlakula. The advertisement requesting a proposal was found to be irregular, and Madonsela said the tender process could have prejudiced other bidders.

"Tlakula's actions risk a loss of public confidence in the IEC and also threaten the IEC's reputation as an impartial constitutional body," said Madonsela. "Tlakula's actions foster a perception from potential service providers that they can't expect fair, equal treatment from the IEC."

The problem in the lease came down to an "undisclosed conflict of interest" between Tlakula and businessperson Thaba Mufamadi, who has an ownership stake in the property through his company.

Theirs was possibly a romantic as well as a business relationship, it has emerged. 

Improper romantic relationship
Mufamadi's company, Manaka Property Investments, owns a 20% stake in the trust that owns the Riverside Office Park, City Press has previously reported.

Allegations of an improper relationship emerged when a group, referred to as "concerned IEC employees", came forward claiming a romantic relationship between Mufamadi and Tlakula, Madonsela said on Monday.

Meanwhile, City Press reported in April last year that Tlakula was Mufamadi's business partner in a mining logistics company called Lehotsa Investment since 2006.

Tlakula and the IEC denied to the newspaper at the time that the relationship constituted a conflict of interest.

Tlakula responded to Monday's report by Madonsela angrily, saying she only saw it at the 11th hour, the South African Press Association (Sapa) reported. Tlakula said in a statement that she had only received the report in the early hours of Monday morning.

"Despite many requests to and assurances from the public protector that I would have access to the final report on alleged irregularities around the procurement of the IEC's offices in Centurion at least one day prior to it being published, I only received  it at 04:00 this morning [Monday]," Tlakula said in a statement.

"It has left me with minimal time to critically review this document before she releases it to the media."

Tlakula's future after this report is unclear, as is the current leasing deal. Madonsela recommended that the speaker of Parliament and the IEC must decide whether action must be taken against her.

Forensic investigation into lease
The IEC's chief procurement officer must consider commissioning a forensic investigation into the lease agreement, said Madonsela at the briefing, adding that the IEC should – in consultation with treasury – consider reviewing the entire lease agreement. Madonsela also said the IEC must consider taking action against all members of the IEC's executive committee. 

The complaint about the IEC's new headquarters was first lodged by the United Democratic Movement's Bantu Holomisa on October 15 2011. He questioned the validity of the lease agreement and payments made by the IEC. Madonsela found irregularities with inconsistent monthly rental amounts for the property.

Riverside is the Centurion office park in which the IEC has been renting more than 9 700 square metres of office and storage space since September 2010.

The Riverside Office Park lease deal was signed in August 2009, with an initial monthly rental of about R1.5-million in 2010. The rental increases by 9% annually.

Madonsela looked into allegations and corruption of maladministration into the procurement process of acquiring the organisation's headquarters. The allegation of a romantic relationship between Mufamadi and Tlakula was, however, not investigated.

"It must be noted that Mufamadi was approached on whether I must investigate the allegations of a romantic relationship," said Madonsela. However Mufamadi did not respond.

Madonsela's investigation also included interviews with IEC commissioners and former commissioners, including Brigalia Bam. Tlakula was accompanied during her interviews by her lawyers.

Tlakula was apparently unhappy with a 2009 contract signed with Menlyn Corporate Park and requested a new lease. Adverts where then issued for the headquarters, said Madonsela. In September 2010 the IEC moved into their new headquarters at Riverside Office Park.

Tlakula said in April 2012 the decision to award the contract was taken by the IEC, not the organisation's executive committee, on which she served at the time, City Press reported.

Manaka property's bidding involvement
She said Manaka was not involved in the bidding and she had no knowledge of their involvement in any way.

Tlakula said the committee submitted the proposals for Riverside and another rival bid to the commission without any indication of a preference and the commission approved the move to Riverside Office Park.

"I had no knowledge of Manaka's involvement and I think they got involved through a consortium at a later stage. But I didn't have anything to do with the awarding of the contract," said Tlakula.

She said Lehotsa Investment has been dormant since 2007 and that she had declared her business interests. Mufamadi denied that Tlakula was a business associate because, he said, Lehotsa was dormant.

He said he had never discussed the lease with Tlakula, and said that as Manaka's chairperson he was not involved in Manaka's operational affairs or any negotiations for contracts.

"IEC's Pansy Tlakula must go," tweeted Bantu Holomisa shortly after the briefing, saying her "improper conduct and maladministration risks loss [of] public confidence".

Tlakula said she tried to "engage extensively" with the protector "throughout the process on matters relating to her investigation", Sapa reported.

"These include, gross procedural irregularities in the conduct of the investigation, errors of fact and law, abuse of power by the public protector leading up to the compilation of the provisional report, and submissions on legal principles regarding conflict of interest.

"I hope that she has given due regard to my submissions.

"I will review the report and issue an appropriate response as soon as I have done so. I believe that because of the nature of the work that the IEC does that the findings of the public protector's report, should be given proper consideration before I respond."