R.L.P. OFF
How ANC scored from Mandela funeral
MILLIONS in public funds spent on Nelson Mandela’s funeral were paid to suppliers without official approval, sparking accusations that some of the money was used to bankroll the ANC’s election campaign.
A Sunday Times investigation has established that the Eastern Cape provincial treasury deposited R250 000 into the bank account of ANC provincial chairman and finance MEC Phumulo Masualle. Thiswas reversed five days later after questions about the transaction arose. Masualle has denied any wrongdoing.
The Daily Dispatch newspaper reported that businessman Mzwandile Sokwale was paid an inflated R6-million to transport 8 000 mourners to Mandela’s funeral and that some of this money landed up with the girlfriend of Buffalo City’s regional ANC secretary, Phumlani Mkolo.
A forensic report obtained by Sunday Times R22-million in funeral costs, including for Tshirts, food and transport, was disbursed irregularly by the Eastern Cape Development Corporation through a secretive “Project X”.
The corporation is funded by taxpayers.
A paper trail uncovered by Funduzi Forensic Services, which compiled the report, and detailed information supplied by several sources reveal that Project X entailed collusion between the corporation’s top brass, provincial treasury officials and senior ANC politicians and their cronies.
Two senior provincial sources said independently that provincial party bosses had orchestrated the diversion of some of the money to the party’s election coffers. “We needed the money for the elections and this was the best way to do it,” said a source with direct knowledge of Project X.
“We’d pay the service provider so much, and the service provider will withdraw the money and give a cut back to the ANC.”
“There is no doubt that some of this money was channelled to fund the ANC’s election campaign,” said another senior ANC member.
The report said another R55million spent fell outside the scope of its investigation, suggesting the final tally of dodgy payments could be higher.
The scandal, exposed by the Daily Dispatch, led to the axing of the corporation’s CEO, Sitembele Mase, earlier this month. The report also recommended suspending its chief financial officer, Sandile Sentwa, who disbursed the funds without board approval.
The report, which was handed to the Hawks, reveals that:
Almost R20-million was paid to suppliers in 10 days in December without board approval. Mase and Sentwa are authorised to approve only payments up to R5-million;
These payments were disbursed based on an unsigned memo from the provincial treasury to the Eastern Cape legislature to break procurement rules by treating Mandela’s funeral as an emergency;
In December, Mase instructed his staff to ignore the procurement rules in disbursing funds for the funeral;
At least R14-million was disbursed, including for transporting mourners and printing Mandela T-shirts, “without any quotations or invoices”; and
We needed the money for the elections and this was the best way to do it. We’d pay the service provider so much, and the service provider will . . . give a cut back to the ANC
The original memo allowed funds to be used only for “infrastructure support” for Mandela’s funeral — but was later doctored to authorise payments for “any costs related to the funeral”.
This week, Masualle said accusations that the funds were for the ANC’s election campaign were “mischief”.
He confirmed his department had deposited R250 000 into his personal bank account “to cater for any unforeseen expenses” because he had been assigned to “champion” Mandela funeral preparations. The full amount was reversed five days later.
There was clearly disquiet among officials about the large amounts paid for transport, catering and T-shirts.
An e-mail sent to Mase by provincial treasury head Marion Mbinda-Mthembu on December 11 suggests that the government had been “taken for a ride”.
She warned: “I get the sense that some people are taking chances.”
Mase responded by telling her to “cool down”.
The forensic report warned that “some of the funds disbursed may not have been [used] for the said arrangements of our former state president’s funeral” and recommended a “detailed [police] investigation of where the money went after it was paid to the supposed service providers”.
Payments likely to come under scrutiny include R4.9million paid to soccer boss Siviwe “Chippa” Mpengesi, a close associate of Masualle.
Mpengesi’s company, Reagola Print and Media, was paid R3-million on December 11 and another R1.97-million to print 50 000 Mandela T-shirts for the funeral on December 15.
Another company was paid R1.3-million to print another 20 000 T-shirts.
A Johannesburg T-shirt printing company provided the Sunday Times with a quotation of R2-million for 50 000 T-shirts.
Mpengesi confirmed that Reagola was paid R4.9-million for supplying 50 000 T-shirts requested by treasury officials. He denied inflating the costs.
The report also flagged R250 000 paid to Victory Ticket 750. The Daily Dispatch reported that the Buffalo City metro paid Victory Ticket R6-million to transport 8 000 mourners to Mandela services in East London, Mdantsane and King William’s Town. This equates to R750 a passenger.
Victory Ticket’s CEO, Mzwandile Sokwale, referred questions to his lawyer, who failed to respond.
Sentwa said he had acted under instructions from his CEO, Mase, and the provincial treasury. “Procurement responsibility doesn’t rest with us — it rests with treasury, who gave us written instructions,” he said. “He [Mase] gave me assurances that everything was above board.”
Mase said the disbursements were based on the legislature’s resolution and referred all questions to his lawyer, Bridgette Magnus. She said they would challenge “the termination of his employment”.
“He is a threat to certain people that will come out in due process,” Magnus said.