Behind Jo’burg’s dirty tenders

Two senior officials at the City of Johannesburg have been suspended for alleged serious misconduct involving billions of rands in tenders.

Sanjay Dubru and Jimmy Maluleke oversaw controversial deals in the past two years and at least two multimillion rand contracts they were involved in have been put on ice.

Dubru’s suspension notice, dated January 30, noted prima facie evidence of acts of serious misconduct that requires an investigation. City spokesperson Nthatisi Modingoane said he could not divulge why Dubru and Maluleke were suspended.

Mayor Geoffrey Makhubo said in a statement on Wednesday that there had been illegal procurement and poor contracting practices in the city. Unplanned and manufactured emergency procurement situations had also occurred, he said, specifically pointing to the fleet contracts, which were awarded through a deviation process. (A deviation process allows contracts to be awarded to sole suppliers or in an emergency to not go through the regular tender process.)

“The issues of fleet within the city have proved to be a hotbed of corruption and malfeasance,” Makhubo said. “Preliminary investigations have brought to light violations of the MFMA [Municipal Finance Management Act], SCM [supply chain management] processes and, as a result, the fleet contracts account for the high irregular expenditure in the city over the last two years.”

He added that corruption and maladministration would not go unpunished. “We have acted against two senior officials who are on suspension pending a disciplinary process.”

These allegations are not new. Numerous sources said they had reported Dubru to the city manager, Ndivhoniswani Lukhwareni, the former city speaker, Vasco da Gama, and Shadrack Sibiya, the head of the anti-corruption unit, yet Dubru seemed “untouchable”.

Modingoane said the complaints filed against Dubru had been referred to Johannesburg’s Group Forensic and Investigation Services (GFIS). “The suggestion that such a complaint was suspended is incorrect. We wish to state that GFIS has investigated the complaints filed against Mr Dubru and the investigations are still ongoing.”

The deviations

Dubru first popped up last year when the Mail & Guardian analysed more than 80 contracts that were either recommended or approved to bypass the regular tender process. Dubru and his subordinate, Maluleke, were involved in pushing through some of the deviations.

Dubru did not respond to questions nor answer calls from the M&G.

The chief director for governance, monitoring and compliance in the chief procurement office treasury, Solly Tshitangano, warned last year that state entities, including municipalities, were abusing these regulations, opening the public fiscus to looting through inflated contracts.

Before arriving at the City of Johannesburg in 2018, Dubru had been suspended for a year while he was employed at the Johannesburg Market. The charges of corruption were dropped and he was handed a settlement of more than R1-million. A few months later, he was seconded to an integral position in the city, that of acting executive director of group corporate and shared services. Essentially he directed the nuts and bolts of the city’s administration.

Three major contracts were recommended and signed off during Dubru and Maluleke’s time:

  • Afrirent was awarded the R1.2-billion fleet contract for non-specialised vehicles;
  • Avis was awarded a R295-million fleet contract for the maintenance of Pikitup waste management vehicles; and
  • TFM Industries was handed the R500-million contract for fire engines and trucks.

Modingoane defended the use of deviations, saying Lukhwareni has the power to approve such deviations. “Your allegation that the city manager allowed such deviation process to be overused is incorrect and baseless.”

All three companies had previously denied any wrongdoing in how the city awarded them the contracts. 

The big contracts

The moment Dubru arrived at the city he wanted to know what the big contracts were, according to three sources. In addition to the fleet contracts, he allegedly wanted the specifications of the R136-million printing contract, which has now been put on hold because of alleged irregularities, according to two reputable sources.

But Modingoane denied that the printing contract was on hold, saying the city was simply in the middle of discussions with service providers about contractual matters.

In July Lukhwareni was informed of Dubru’s alleged interference in the printing contract. Dubru had allegedly approached service providers to negotiate pricing while the tender process was still ongoing.

When bid committee members wanted to cancel the printing contract because of the interference, Dubru suspended one of them, Indrin Mariemuthoo.

Mariemuthoo said his lawyers were taking his year-long suspension to the bargaining council.

Da Gama confirmed that Mariemuthoo had laid a complaint. “There are two occasions I know of that Sanjay [Dubru] was to be investigated. But I am not sure how far the cases are because I forwarded the complainants to the GFIS. There are a lot of outstanding cases though, quite a backlog.”

(John McCann/M&G)

The suspensions

Those who questioned Dubru or Maluleke about the tenders would be suspended, sources told the M&G.

Two months into his post, in May 2018, Dubru suspended his group head, citing interference in contracts. The group head resigned in October of that year.

In an affidavit before the city’s anti-corruption unit, the group head alleged that Dubru made “unethical requests”, including asking “if I can get the contract for non-specialised vehicles cancelled. Dubru thereafter requested from me if I can make sure that the contract be given to another company who tendered.”

It is also alleged in the affidavit that Dubru used the name of the city manager (Lukhwareni) and of a member of the mayoral committee when questioned about his interference in procurement processes and sidelining key people.

“Dubru started requesting information regarding contracts. Dubru went to the extent of requesting confidential tender files from my staff. He also requested the specifications for the non-specialised fleet contract and the photocopy contract from my staff. They complained to me about these requests,” reads the affidavit.

“I directly asked Dubru why is he getting involved in contracts at his level, because, as the group head, I do not get involved with the details of procurement processes. Dubru’s response to me was: ‘This is bigger than you and me and that I should not resist’.”

The M&G knows of at least three other officials suspended by Dubru for allegedly tampering with tenders. They were suspended after they had complained about his interference. One has filed a complaint with the Commission for Conciliation, Mediation and Arbitration.

The denials

The half a billion rand fire engine contract that Dubru and Maluleke were instrumental in handing to truck building company TFM Industries through a deviation, was set aside for a review by the high court in Johannesburg last year. Two weeks ago the city lost its bid to overturn this decision.

This means the city has only five fire engines to service the five million residents of Johannesburg while the contract is reviewed.

When Maluleke was asked about his involvement in the deviations he denied reporting to Dubru and sending emails to TFM or any other fleet company. This is despite the fact that internal memorandums and recommendation letters have his name on them.

In October Maluleke recommended to Dubru that Avis’s contract should be extended using a deviation.

In June he recommended that the fire truck contract be awarded to TFM through a deviation.

There are also emails between Maluleke, Dubru and the service providers he was negotiating with for the fire trucks.
But Maluleke denies all of this, saying he was only in the position of fleet compliance and management for three months between November 2018 and January 2019.

“You can’t verify those documents and so they are not authentic. I was only there for three months and during that time the municipality doesn’t award contracts. So I could not have recommended anything you are saying I did. I do not work in the fleet department anyway. I have never sent emails, I don’t send emails to service providers,” he said.

Meanwhile, an internal memorandum shows that as recently as October 2019, Maluleke had asked Lukhwareni to approve a negotiated deal with Avis to enter into a month-to-month agreement to provide certain vehicles to the city until September this year at a cost of R295-million.

With so many suspensions, denials and evident deals that were entered through questionable deviations, resolving the city’s multibillion-rand tender mess has a long way to go.

We make it make sense

If this story helped you navigate your world, subscribe to the M&G today for just R30 for the first three months

Subscribers get access to all our best journalism, subscriber-only newsletters, events and a weekly cryptic crossword.”

Athandiwe Saba
Athandiwe Saba

Athandiwe Saba is a multi award-winning journalist who is passionate about data, human interest issues, governance and everything that isn’t on social media. She is an author, an avid reader and trying to find the answer to the perfect balance between investigative journalism, online audiences and the decline in newspaper sales. It’s a rough world and a rewarding profession.

Related stories


Already a subscriber? Sign in here


Latest stories

Opposition caucuses on panel for Ramaphosa impeachment probe

The parties want to leave the speaker little discretion in composing the panel that will decide whether there is a case for impeaching the president

Amazon may threaten SA retailers

Amazon plans to move into South Africa in 2023 and the world’s biggest online marketplace might give local companies a run for their money

Gallo celebrates 95 years

The history of Africa’s first record label is studded with successes — and controversies

Creecy shoots down Karpowership appeal but extends a lifeline to...

The Karpowership proposal lacked proper environmental assessments, according to the minister, with noise impacts specifically noted

press releases

Loading latest Press Releases…