A COMPANY owned by an ANC regional leader is at the centre of a R10-million housing tender scandal after a forensic investigation found the contract was awarded irregularly.
But despite the inquiry finding that Buffalo City Metro had ignored supply chain management processes and recommending action be taken against top officials, the report has been gathering dust at the East London City Hall for almost a year.
The tender for the completion of 150 houses in Mdantsane’s Unit P was awarded to businessman Koko Godlo’s Imvusa Trading. A forensic inquiry by MMB Consulting revealed it was the only company invited to submit quotes for the job.
Council then sanctioned an investigation into how Godlo’s company was appointed, and MMB Consulting completed its probe last May. It confirmed supply chain processes were not followed and found that Imvusa’s appointment was “predetermined”. The investigation recommended that city manager Andile Fani and metro housing acting director Thabo Matiwane be charged for contravention of supply chain policies.
The Daily Dispatch has seen a copy of the report.
It is yet to be tabled in council – 11 months after its completion – and has been sitting in executive mayor Zukiswa Ncitha’s office.
Metro spokesman Keith Ngesi said he could not comment on a “leaked” report.
“As administration we cannot comment on a leaked report that has not been tabled before council as we don’t have access to it. We therefore humbly request that queries of this nature in future be discussed with the leakers,” Ngesi said.
No response to e-mailed questions was received from council speaker Luleka Simon-Ndzele. Ncitha, Fani and Matiwane could not be contacted for comment.
Godlo, the ANC’s election team coordinator in Duncan Village, said there was no wrongdoing on his part.
“I am a contractor and I have done what was required of me, which was to build houses. The issue of how that was awarded – I have no comment on that,” he said.
National Treasury recently threatened to withhold conditional grants of more than R700-million due for the metro because of its failure to deal with forensic probes. Imvusa was initially sub-contracted by Khumbula Property Services (KPS) in 2011 together with two other companies to assist in building 2 003 housing units valued at R115-million.
KPS later had a dispute with the metro, and its contract was terminated in April 2012. However, despite being told to halt construction, Imvusa continued and completed its allocated 45 houses. They were paid just over R1-million. In September 2012, Imvusa was then contracted to build 150 units at a cost of R10-million.
“No costs or prices were attached to their quote and it is unknown how the price of R10-million was arrived at. It seems they were effectively given a blank cheque,” according to the report.
“City manager should be charged with misconduct because he failed to apply supply chain management policy in appointment of to finalise the project after services of were terminated. He more specifically did not act in terms of any urgency.
“Mr Matiwane failed to ensure the subcontractor vacated the site even after he knew they continued to remain on site after services of KPS were terminated. This compromised the municipality which seemed to condone this irregularity. This effectively undermined supply chain processes,” states the report.
Numerous attempts by investigators, including e-mailed questions, to get answers from Fani, Matiwane and supply chain head Thembelani Sali yielded no fruit amid allegations they did not cooperate with investigators, the report claims.
It further states the appointment of Imvusa “seems to have been pre-determined because they remained on site after termination of KPS’s contract”, continuing to construct “as if nothing had happened and there was no real effort to get them off site”. “They must have been reassured or were banking on the support of senior officials and/or politicians.”
It says Fani wrote to Imvusa in June 2012, long before any supply chain processes were undertaken, asking them to submit a quotation for the 150 units.
“This clearly points to Imvusa Trading being preferred,” states the report. —
R10m tender scam buried
But despite the inquiry finding that Buffalo City Metro had ignored supply chain management processes and recommending action be taken against top officials, the report has been gathering dust at the East London City Hall for almost a year.
The tender for the completion of 150 houses in Mdantsane’s Unit P was awarded to businessman Koko Godlo’s Imvusa Trading. A forensic inquiry by MMB Consulting revealed it was the only company invited to submit quotes for the job.
Council then sanctioned an investigation into how Godlo’s company was appointed, and MMB Consulting completed its probe last May. It confirmed supply chain processes were not followed and found that Imvusa’s appointment was “predetermined”. The investigation recommended that city manager Andile Fani and metro housing acting director Thabo Matiwane be charged for contravention of supply chain policies.
The Daily Dispatch has seen a copy of the report.
It is yet to be tabled in council – 11 months after its completion – and has been sitting in executive mayor Zukiswa Ncitha’s office.
Metro spokesman Keith Ngesi said he could not comment on a “leaked” report.
“As administration we cannot comment on a leaked report that has not been tabled before council as we don’t have access to it. We therefore humbly request that queries of this nature in future be discussed with the leakers,” Ngesi said.
No response to e-mailed questions was received from council speaker Luleka Simon-Ndzele. Ncitha, Fani and Matiwane could not be contacted for comment.
Godlo, the ANC’s election team coordinator in Duncan Village, said there was no wrongdoing on his part.
“I am a contractor and I have done what was required of me, which was to build houses. The issue of how that was awarded – I have no comment on that,” he said.
National Treasury recently threatened to withhold conditional grants of more than R700-million due for the metro because of its failure to deal with forensic probes. Imvusa was initially sub-contracted by Khumbula Property Services (KPS) in 2011 together with two other companies to assist in building 2 003 housing units valued at R115-million.
KPS later had a dispute with the metro, and its contract was terminated in April 2012. However, despite being told to halt construction, Imvusa continued and completed its allocated 45 houses. They were paid just over R1-million. In September 2012, Imvusa was then contracted to build 150 units at a cost of R10-million.
“No costs or prices were attached to their quote and it is unknown how the price of R10-million was arrived at. It seems they were effectively given a blank cheque,” according to the report.
“City manager should be charged with misconduct because he failed to apply supply chain management policy in appointment of to finalise the project after services of were terminated. He more specifically did not act in terms of any urgency.
“Mr Matiwane failed to ensure the subcontractor vacated the site even after he knew they continued to remain on site after services of KPS were terminated. This compromised the municipality which seemed to condone this irregularity. This effectively undermined supply chain processes,” states the report.
Numerous attempts by investigators, including e-mailed questions, to get answers from Fani, Matiwane and supply chain head Thembelani Sali yielded no fruit amid allegations they did not cooperate with investigators, the report claims.
It further states the appointment of Imvusa “seems to have been pre-determined because they remained on site after termination of KPS’s contract”, continuing to construct “as if nothing had happened and there was no real effort to get them off site”. “They must have been reassured or were banking on the support of senior officials and/or politicians.”
It says Fani wrote to Imvusa in June 2012, long before any supply chain processes were undertaken, asking them to submit a quotation for the 150 units.
“This clearly points to Imvusa Trading being preferred,” states the report. —
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