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An official took a mortgage bond of R1.6 milllion in 2022 and within two years had paid about R1.1 million. – Deloitte & Touche report.

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Sizwe sama Yende

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A forensic investigation has left a union with an egg on its face after rallying behind a Limpopo corruption-accused municipal manager while threatening an alleged whistleblower.

The Deloitte & Touche investigation commissioned by National Treasury reveals how Thulamela Local Municipality manager, Masala Makumule, flouted procurement processes, sidelined and usurped powers of chief finance officer, Colbert Mufamadi, and supply chain management officials on procurement matters, and worked with junior staff members to take decisions in the allocation of tenders.

South African Municipal Workers Union (Samwu) branch leaders, members and some senior officials in the Limpopo municipality ganged up against Mufamadi whom they intimidated and threatened after they accused him of having blown the whistle on Makumule and leaking corrupt activities to the media.

Samwu heightened its campaign in April by staging a march against Mufamadi for two days to indicate that they were turning a blind eye to the serious allegations against Makumule and did not care about the protection of whistleblowers.

Samwu has refused to comment about its bizarre action.

All the while, National Treasury had, for some unknown reason, had not released the investigation report, which was completed in December last year.  A copy has since been leaked, while, on the other hand, the Hawks have been raided the municipality.

The report proves that Makumule and a cohort of officials bent procedures in the awarding of tenders for landscaping, road rehabilitation and repair of water drainage system valued at R61.1 million that were funded through the Neighbourhood Development Partnership Programmes and Municipal Infrastructure Grants.

Deloitte & Touche findings mirror the allegations that were initially spread through social media last year and confirmed by sources within the municipality.

The investigators recommend that Makumule should be subjected to disciplinary action and a broader investigation encompassing all tenders that were awarded by the municipality be conducted.

Tender corruption was so pandemic, the report indicates, that one official who was involved in the selection of service providers for disaster projects took a mortgage bond for R1.6 million in September 2022 and by August 2024 she had repaid so much that the closing balance was R537 487. The official, who was single, earned R59 935 a month but managed to pay an average of R42 600 a month towards the bond.

Makumule said he had not received the report from National Treasury. "I can't comment on the leaked document not knowing the authenticity," Makumule said.

‘WE SELECTED COMPANIES THE MANAGER WANTED TO APPOINT’

According to the report, Makumule’s interference in supply chain management saw companies being selected unfairly from a panel of contractors with the exclusion of supply chain unit officials and Mufamadi in contravention of procurement procedures.

Makumule appointed two companies – Luvhundi Construction and Dzata Property Development – for the construction of internal roads after selecting them from the panel.

Although National Treasury gave permission for the selection instead of an open bid, further details were not provided to treasury to review the selected companies. The withheld information included the experience of the companies, scope of work and CIBD grading to determine if the contractors were fit for purpose or whether the advice to use the existing panel was appropriate or not.

The report quotes an official as having confirmed that she and her team “selected service providers that the municipal manager wanted them to appoint.”

The process in selecting the contractors was based on CIBD grading and performance and not on procurement processes. Officials also told investigators that even though Dzata was ranked number five among companies on the database, it was selected ahead of them because “they completed orders quicker.”

Performance and quality of work was not considered when the companies were selected.

“We note that there were other service providers with the same CIDB grading as those appointed. However, these service providers were not afforded the opportunity to tender for this project,” the investigators found.

Dzata was ranked number 5 but still got work ahead of other companies. Official said they completed orders quicker, but the spreadsheet did not provide details on the performance and quality of the service providers.

The investigators said it was unfair that Luvhundi and Dzata were allocated more work than other companies on the panel of contractors. Officials issued 14 ordered to the value of R21.8 million to Luvhundi and 12 ordered worth R19.7 million to Dzata.

MUNICIPAL INFRASTRUCTURE GRANT PROJECTS

The report indicates that further corruption was committed when National Treasury approved the reallocation of R28 million of MIG funds four days before the end of a financial year to fix roads damaged by floods in 2022.

A task team was appointed to advise Makumule on the disaster projects. “However,” said the investigators, “it appears that the municipal manager was the one giving instructions to the junior officials, and he would approve advice provided by the task team.”

“We note that the task team appeared to be a front and the municipal manager was the one making decisions. He used junior officials appointed on to the task team to bypass SCM (supply chain management) prescripts in appointing service providers.”

Makumule did not consider advice provided by supply chain official and Mufamadi to follow tender procedures.

Deloitte and Touche appointed an engineering company to assess the work done, and it found that the municipality did not get value for money due to exaggerated prices.

“Additionally, the combination of poor design, unsuitable construction materials and poor construction quality compromises the durability of the roads and may lead to premature wear and tear increasing future maintenance costs and reducing the overall lifespan of the infrastructure. It is not clear why the service providers were appointed as they showed no experience.”