Amatola Water suspends supply chain manager over irregularities

Amatola Water’s supply chain manager has been suspended on a gross misconduct charge over emergency procurement of rainwater tanks for Butterworth, which could have lost the water utility R13.5m.

Clayton Bhana’s alleged gross misconduct is linked to the entity’s case against its suspended CEO, Vuyo Zitumane.

In a letter dated August 31 to Bhana, seen by the Dispatch, Amatola Water acting CEO Boniswa Hene slapped Bhana with six charges, mostly related to gross misconduct or dereliction.

He was to face a three-day disciplinary hearing from September 21 to 23, but a source at Amatola said the date of the hearing had been pushed back to October 9 as Bhana had requested documents pertaining to his case.

In the letter, Hene puts it to Bhana that he circumvented emergency procurement procedures, and breached the Public Finance Management Act, Treasury regulations and supply chain management (SCM) policy when he “unlawfully caused, and/or facilitated and/or condoned the appointment of Crossmoor Transportation and Osher Fuels for the provision of rainwater harvesting”.

On Wednesday, Bhana confirmed the suspension, but said the matter was sub judice and he was challenging it. Contacted later to find out the exact date of when he was placed in precautionary suspension, Bhana could not be reached.

A leaked April report into the financial standing of Amatola Water alleges that Zitumane was involved in the manipulation of tender pricing and supply chain management processes with Crossmoor Transport, based in KwaZulu-Natal.

Osher Fuels is based in Bhisho, according to company records.

Zitumane is on record as saying she was misled by Crossmoor Transport bosses, who failed to deliver on the emergency supply of rainwater tanks in Butterworth.

In the letter to Bhana, Hene says: “You materially breached your managerial duties to act in the utmost good faith in all due diligence and best interest of the employer and are therefore guilty of misconduct which amounts to serious dereliction of duty and gross misconduct in conflict with your office as more specifically set out ... in counts 1 to 6.

“You knew and/or ought reasonably to have known that the appointment of Crossmoor and Osher Fuels on 26 March 2020 was irregular in that it didn’t comply with the SCM policy of the employer.”

Hene’s letter states that the tender specification did not speak to the need of Amatola Water and that “the prices exceeded the market value for the same items substantially”.

“The entities further didn ’ t comply with the specification on the approved quotations regarding the product specified as well as the delivery times, which was the condition of the approval.

“As a consequence of the irregular appointment of Crossmoor and Osher Fuels, [Amatola Water] suffered potential prejudice of approximately R13.5m.

“You procured goods and/or services described as emergency acquisitions without following the emergency procurement process,” Hene wrote.

Other charges against Bhana are:

● He “condoned the irregular appointment of service providers” pursuing the lucrative R230m tender for the delivery and installation of rainwater harvesting tanks in several municipal areas over a period of three years, allowed bids to be issued and funds committed without specifications being drawn up, and “caused and paid” inflated prices to contractors African Vision Project Managers, Bay Breeze Trading, Devomix Construction, Ayakha 222, Revolution of Ubuntu and Take Note Trading;

● He split tenders in order for them to be below the R500,000,00 threshold “to avoid, circumvent and abuse the formal tender processes and regulations to be initiated for tenders over R500,000”;

● Gross misconduct or gross dereliction of duty in relation to the procurement of the water carts; and

● Gross misconduct or dereliction of duty for failing, in November 2018, to ensure compliance with the bid evaluation committee in two tender processes, where documents would either disappear or appear.

The letter also alleges that Bhana cost Amatola Water R43m as a result of his misconduct by “facilitating the manipulation of the adjudication of [a tender] to appoint specific service providers”.

Amatola Water spokesperson Nosisa Sogayise had not responded to queries by print deadline on Wednesday.