Davies to review gambling board after irregular expenditure of millions
TRADE and Industry Minister Rob Davies has proposed a review of the National Gambling Board after a forensic investigation uncovered irregular expenditure of millions of rand.
Davies told members of the portfolio committee on trade and industry on Friday that the way the board functioned left a lot to be desired.
Dean Macpherson, DA deputy spokesman for trade and industry, said that Davies must disclose the names of those who were responsible for the problems at the National Gambling Board.
“I will therefore today (Friday) be writing to Minister Davies, calling for the release of the full uncensored report, so that effective accountability can occur… While these findings are very serious, until the names of those responsible are disclosed, no one is being held to account,” Macpherson said.
Davies’ department could not confirm information by the DA that the value of the national central electronic monitoring system was R1 billion and that the lease for new office space was R50 million.
Davies told MPs that the findings touched on systemic issues at the gambling board.
“I have left out findings that touch on any individuals, but (these findings) tell us a sorry state,” said Davies.
He would not give figures for other projects, except to say the report found irregularities.
The forensic investigation followed a number of breaches picked up the auditor-general by July last year. This led Davies to suspend all the members of the National Gambling Board last September.
Davies told MPs that this was a preliminary report into the investigation, and a full report would be tabled later.
Some members of the board have since been reported to have quit.
Davies said the forensic report found that the procurement of a 10-year lease was flawed. The lease is said to cost R50m. He said the gambling board had set up a sub-committee on the purchase of the national central electronic monitoring system.
Davies said there were no minutes and recordings of the majority of the sub-committee meetings and forensic investigators found that the procurement process was flawed.
The office space for the new building was three times higher than the gambling board’s previous offices at the DTI campus in Pretoria.
“The National Gambling Board was committed to the revised budget for tenant installations and relocation of R14m and is found to be irregular,” said Davies. In addition, there was irregular expenditure of R3.6m. He also said the appointment of a law firm to the tune of R2.2m was not in line with the law.
The gambling board also violated supply chain management rules when it appointed another law firm for R435 000.
Davies said they had since cancelled these contracts.
The board incurred losses of R140 000 for appointing former board members to take part in certain activities of the board.
Davies also said the report established that two trust accounts were unlawfully opened. These accounts had been frozen and a total of R4m in deposited funds available in these two accounts.
The forensic investigation also found that the board had had a series of meetings, which were not warranted.
“The significant increase in meetings was not warranted and led to year-on-year fee increment per certain board members at 21 percent, 29 percent, 56 percent and 58 percent,” he said.
He told the committee they were reviewing policy on the functions of the board.