Former water affairs official Sifiso Mkhize.
The appointment of a company to look into the spiralling irregular expenditure by the department of water and sanitation was in “flagrant disregard of the law”, according to an internal audit.
The department’s former acting director general, Sifiso Mkhize, is being investigated for fraud for his alleged role in hiring Fumile Advisory Services for more than R60-million without going through the proper processes.
Mkhize was appointed to the post in 2017 and was removed in June last year. He resigned shortly afterwards. By July, the department had opened a case at the Pretoria Central police station, which was then passed on to the Hawks.
Hawks spokesperson Hangwani Mulaudzi said a case of fraud and corruption was being investigated.
Attempts to get comment from Mkhize were not successful.
These details are in an internal audit report annexed to court papers filed by the department in December last year. The department has asked the high court in Pretoria for an order to freeze the pension payouts of two former executives until it had been established what their possible liability was for allegedly being party to the awarding of the tender to Fumile and paying the company.
The Mail & Guardian reported last week that one of them, former acting chief financial officer Mbalenhle Manukuza, claimed in her answering affidavit that she had been approached by the current minister’s adviser and an MP to implicate the former minister of the department, Nomvula Mokonyane, and Mkhize in wrongdoing.
The internal audit investigated how Fumile was awarded a R64-million tender to review irregular, fruitless and wasteful expenditure in the 2016-2017 financial year.
According to that year’s annual report, irregular expenditure had increased from R781-million in 2014-2015 to R2.4-billion in 2015-2016, which was mainly a result of irregular expenditure incurred by the Lepelle Northern Water Board.
The board was the implementing agent of the Giyani water project, and billions of rands have been paid to build water infrastructure in the Mopani district municipality in Limpopo, yet many villages are still without water. The project has not been completed.
The audit report sets out how Fumile became the only company to bid for the tender to look into irregular expenditure because, although an invitation was made to four companies, they were given only four days in which to submit their tenders. An email inviting the four, including Fumile, was sent out on December 15 and the due date was the 19th. “Furthermore, the 16th December 2017 was a public holiday,” according to the report.
None of the service providers invited to bid had submitted their proposals by the due date. The Fumile representatives handed over their application about 30 minutes after the cut-off time. The company was awarded the tender, despite “the fact that these documents were submitted late and were not deposited in the tender box”, the report states.
Naph Nteo, a partner at Fumile, said he would not comment because he was driving.
According to the report, on December 22, Mkhize approved a submission recommending that Fumile be awarded the tender. It concluded that the process followed was one of the “worst forms of a flagrant disregard of the law and a complete failure to observe the rule of law. There is evidence to indicate that the intention was always to appoint Fumile.”
The report notes that, once the contract was signed, Fumile continued with its work and invoiced the department for more than R17-million.
Drowned boy a victim of negligence
Six-year-old Nsuku Mhlongo fell into a hole filled with rainwater and drowned on Saturday.
The pit was dug for water pipes by Khato Civils, which stopped its work for the water and sanitation department when it was not paid, the company said.
Khato Civils was contracted to build water infrastructure for 55 villages in Giyani, Limpopo.
The Giyani Bulk Water Project is one of the major reasons the department’s fruitless and wasteful expenditure has spiralled. In its 2016-2017 annual report, the department singled out the project and its implementing agent, the Lepelle Northern Water Board, as the main culprit.
The multibillion-rand project is being investigated by the Special Investigating Unit.
Gaping holes all over Giyani have been open for five months.
Mongezi Mnyani, the group chief executive of Khato Holdings, said:
“We made sure that there were safety measures in place around all those holes.
“We told DWS [the water and sanitation department] and Lepelle that we were off site and it was their responsibility to monitor that the measures are still in place. But they didn’t do that.
“We suspect that someone tampered with the safety measures,” he said.
But the spokesperson for Lepelle, Simon Mpamonyane, said the responsibility to close the holes fell to the contractor who dug them.
“Paid or not, as [Khato] left the site they should have closed those holes, but they didn’t. Somebody should be held accountable for this tragedy, but for now we cannot be pointing fingers. We need to assist the family and close up those holes.
“On Monday, a contractor will start closing those holes so we don’t see a repeat of this thing,” he said.