Damning report of irregular expenditure

Emfuleni Municipality: some directors of the companies implicated have full-time jobs in government

SOME of the directors of companies implicated in the R872million irregular expenditure at Emfuleni Local Municipality have full-time jobs in government.

This is according to a confidential report of irregular expenditure at Emfuleni, which revealed that Eskom board member Sifiso Dabengwa’s company, Gijima Ast, was irregularly paid more than R25m by the Emfuleni Local Municipality.

Dabengwa has been an Eskom employee since July 31, 2007, and he joined Gijima as a non-executive director in 2016.

Gijima is an ICT (information and communications technology) company, co-owned by multimillionaire Robert Gumede – a well-known financial backer of the ANC.

The confidential report also pointed out that the spouse of Gijima’s chief operating officer, Moses Maphumuzana Nxumalo, was working at the Department of Health.

According to the report, Gijima was appointed to provide the municipality with 20 cellphone contracts for standby purposes in terms of the appointment dated February 20, 2003.

“The contract is now 15 years old and includes 3Gs and, at some stage, included telephones. No extension of scope/contract was issued, but the service provider continued to provide different services from the original service procured and (continued to) receive payment from the municipality,” the report revealed.

It stated that, by the end of June last year, the municipality had paid R25 226 517.33. During the 20172018 financial year, it paid Gijima R307 355.47.

The municipality still owes an outstanding amount of R160070.72, which will bring the total amount to R25 693 943.52.

The report stated that the contract was in contravention of the Municipal Finance Management Act (MFMA) section 116(1)(a) and (b) and 116(3). It was also found to have been in contravention of section 84 of the Municipal Systems Act 32 of 2000.

In another revelation, the confidential report showed that one of the directors of Dikopane Projects and Management company, which was awarded a contract to supply and deliver fuel and lubricants, had a fulltime job at the Department of Health.

Shailendra Lala, who has been in the employ of the health department since January 31, 2015, was named as the director of the company.

Dikopane was appointed on November 1 last year, through a competitive bidding for a period of 36 months, as and when required, according to their service level agreement. The original appointment letter was signed on October 20 last year by the Acting Accounting Officer.

The original diesel price was R10.83 inclusive of VAT, while the octane petrol price was R11.

The starting date for the contract was October 24 last year, and it ends on September 23, 2020.

The report showed that Dikopane had already billed Emfuleni Local Municipality from inception to June 30 this year – more than R5.5m in just one financial year. The municipality still owes them R1.6m.

Emfuleni mayoral spokesperson, Lebo Mofokeng, said the council meeting resolved on Thursday to refer the report to the Municipality’s Public Accounts Committee (MPAC) to take action against all those parties who have been implicated.