W Cape ‘culture of patronage’ laid bare

THE Special Investigating Unit (SIU) report made damning findings against four Western Cape municipalities –unearthing a culture of patronage where service providers received preferential treatment from friends, spouses and even attempts at bribing an official with alcohol.

The report, which probed the procurement of Personal Protective Equipment (PPE) across different spheres of government, investigated allegations levelled at six municipalities and found irregularities in four councils for several contracts amounting to R44 million.

The City of Cape Town, Kannaland, Matzikama and Cederberg Municipality were all flagged for either irregular procurements or exposing the municipalities to financial risks as well as failure, in service contracts, to reveal close or personal relationships to municipal officials involved in the procurement processes.

The SIU has referred multiple cases to the National Prosecuting Authority, the SA Revenue Service and the Competition Commission for further action.

The City of Cape Town accounted for a large chunk of the R44m after the report declared that R42.1m was paid to Dowing Marquee Hiring to erect tents at Strandfontein to house the homeless during level 5 of the lockdown as irregular expenditure.

The municipality has since claimed it followed emergency procurement processes to comply with tight deadlines imposed by level 5 lockdown regulations, two years ago.

In Matzikama, the report found that two contracts worth over R1 million were irregular and unlawful. On both accounts the service providers failed to disclose close personal friendships with high ranking officials within the municipality.

In one instance, the manager for legal and administration, Siak Jenner, had a friendship that spanned more than 34 years with the CEO of Rural Impact, Andries Blankenberg, whose company was contracted to provide humanitarian relief to the poor.

The municipality’s chief financial officer Jafta Booysen, who approved the irregular appointment, was among three people referred for criminal investigation in August.

The municipality’s former municipal manager, Aldrich Hendricks, was also referred to the NPA for possible prosecution after the SIU unearthed communication between Duneco and Hendricks that may have contravened the Prevention and Combating of Corrupt Activities Act. Jacobus Klazen, chief executive of Duneco, was flagged for failing to disclose his friendship with Hendricks. This comes after the municipality awarded to Duneco a R400 000 contract to provide 20 000 facemasks and 5 000 gloves.

Spokesperson for the municipality, Elizna Mouton, said Jenner was the only remaining official who has been implicated. Jenner was served with a suspension letter in December by the municipality.

“All the other persons implicated in the report (are) no longer employed by the municipality,” she said.

In neighbouring Cederberg Municipality, the report flagged several contracts including one where a former employee, Marice Mercuur, was awarded a contract for R21 140 to provide

sanitisers and liquid soap and charged VAT on her quotation despite not being a registered VAT vendor.

She also failed to disclose that her husband Nigel Mercuur was a senior manager at Cederberg.

Another contractor, was paid R28 980 to provide loud hailing services

for three days to warn residents about Covid-19 and reportedly received a tip-off from senior manager, Thomas Twigg, to lower her bid quotation.

Twigg was also implicated in another

contract where a service provider charged more than what the National Treasury had prescribed and was awarded a R300 000 contract to supply masks and sanitiser with 70% alcohol. But not only was the company, Michlo, found to have supplied a 25-litre drum of sub-standard sanitiser, but its chief executive, Sahun Neves, failed to disclose his close friendship with Twigg.

The report said Neves and another owner of a different company, attempted to bribe a state official with R500 and alcohol.

Cederberg’s mayor, Ruben Richards, said: “We have started with the internal disciplinary processes against the implicated officials and further details will be made available after our Special Council (meeting) that will take place within the next seven days.

“Council is establishing a Disciplinary Board for Financial Misconduct to deal with these matters. We will implement the recommendations made by the SUI and ensure we deal with alleged financial misconduct decisively.”

In Kannaland, two managers, Eben van Rooi and Pumezo Mngeni, were recommended for disciplinary action in a letter handed to acting municipal manager Morne Hoogbaard in September last year.

The two were found to have facilitated the advance payment of around R134 676 towards a service provider that was meant to supply food parcels. While the procurement itself was not irregular, the advance payment to a service provider that did not have the capacity to provide the required products was flagged as exposing the municipality to financial risks.

The report said the municipality had yet to begin disciplinary hearings despite being issued with a letter advising this last year.

But Hoogbaard told Weekend Argus the SIU had advised him that investigations were still ongoing at the time.

Political analyst, Sanusha Naidu, said the report made stark revelations about the running of municipalities, governance failures where coalitions were in place as well as oversight dereliction in the so-called well-run DA City of Cape Town.

“The report also highlighted how a lot of the (procurement) involved family connections – people saying ‘let’s make a buck out of the systems’. And it is in those small municipalities where the DA finds itself needing to be much more hands-on. How do they break those patronage systems that exist there?

“It will definitely be important for the City of Cape Town and the new leadership to investigate this. While we may claim the Western Cape is run well and there is a good governance structure – this R42 million is a big blight on that,” she said.