Saturday, July 16, 2011

Improper, Illegal, Invalid and Unlawfull

Public Protector Thuli Madonsela's final report into the scandalous R1.78-billion police lease deals heaped criticism on Public Works Minister Gwen Mahlangu-Nkabinde, calling for harsh action to be taken against her.

Thuli Madonsela

Gwen Mahlangu-Nkabinde

Releasing the second report into the controversial lease deals, Madonsela again singled out Mahlangu-Nkabinde and National Police Commissioner General Bheki Cele.

General Bheki Cele

She said both had acted "improperly" and "unlawfully" and that the deals were illegal and invalid.

Her first report into the police headquarters deal in Middestad, Pretoria, was released in February. It was scathing of Cele, saying his "improper and unlawful" conduct was central to the signing.

Yesterday, she said Cele's failure to enforce the correct tender procedures for the Transnet Building in Durban the SAPS intended to lease amounted to maladministration.

But Mahlangu-Nkabinde came off worse yesterday, with Madonsela urging President Jacob Zuma to take action against her and some of her top officials.

"The president should consider taking action against the minister of public works for her actions referred to in this report and the report on the procurement of the lease of the Middestad building.

"I'm not prescribing to the president what to do, but I expect him to do the right thing."

Madonsela said Mahlangu-Nkabinde failed to co-operate with her investigation and that her conduct "failed to meet the requisite stewardship expected from her".

Mahlangu-Nkabinde not only ignored a request from Madonsela's office in August last year to halt the implementation of the lease deals until she had finished her investigation, but also ignored legal advice from two senior counsel advising her against them.

She also went against an internal inquiry by her office that found that the agreements were illegal.

Her duty being to "ensure that public finances are not wasted", Madonsela also recommended that Mahlangu-Nkabinde explain to the cabinet within 60 days why she took those decisions and why she failed to co-operate .

Madonsela also recommended that the Treasury and the Department of Public Service and Administration take "urgent" action against officials who broke the law.

"The reckless manner in which the DPW dealt with public funds in this case, particularly by not following prescribed tender process without justification, not ensuring that the state received value for money, fell short of the requirements of good governance and administration," Madonsela said.

The dodgy lease deals were exposed in August last year when the Sunday Times reported how property mogul Roux Shabangu had managed to get the police and Department of Public Works to rent two of his buildings at inflated prices, even though SAPS couldn't afford them and didn't need them urgently.

Roux Shabangu

For the Middestad building in Pretoria, the rent was initially set at R85/m² and was later escalated to R125.40/m², a total of R614-million for 10 years.

For the Transnet building in Durban, the rent was first set at R40/m² but hiked to R125.30/m² - R1.16-billion for the same period - before it was signed with Shabangu.

"This rendered the process unlawful and further constituted improper conduct and maladministration," said Madonsela in her second report, called 'Against the Rules Too'.

She found that not only were both buildings of the worst - or C-grade - standard and in need of major refurbishment at significant cost to the state, but that the state was being ripped off.

In both leases, the SAPS negotiated with Shabangu before the Department of Public Works got involved in the process as required by law. To afford it, the police would have to divert money from elsewhere in its budget.

Madonsela alleged that Shabangu contacted police and public works officials, and pressurised them into finalising the deals. Shabangu has denied this.

She also said Shabangu admitted that he would receive prior warning from sources in public works if any government department was in the market for office space.

Madonsela said she would support any legal action taken by complainants Institute of Accountability in Southern Africa director Paul Hoffman, and Freedom Front Plus MP Pieter Groenewald.

"I have indicated that I will back the parties in court and confirm my report."
Cele's spokesman, Major-General Nonkululeko Mbatha, said in a statement:
"The SAPS will release its official response early next week."


August 1 2010: Sunday Times exposes how Police Commissioner Bheki Cele allegedly flouted tender procurement procedures in a deal for headquarters in Pretoria and Durban with businessman Roux Shabangu.

August 2: A complaint regarding the deal is lodged with Public Protector Thuli Madonsela by Paul Hoffman of the Institute for Accountability in Southern African and Pieter Groenewald of the FF+.

August 3: Madonsela asks Cele not to proceed with the deal pending her investigation. He agrees.

August 4: Mzilikazi wa Afrika, one of the journalists who broke the story, is arrested by police at the Sunday Times offices, held overnight and released by court order the next day.

August 5: Madonsela launches an investigation into the deal, supported by the Special Investigating Unit.

August 16: Public Works Minister Geoff Doidge says in response to a parliamentary question that the leases are on hold pending Madonsela's investigation.

October 31: President Jacob Zuma fires Geoff Doidge and replaces him with Gwen Mahlangu-Nkabinde.

December 7: Mahlangu-Nkabinde reinstates the Middestad building lease.

December 15: Mahlangu-Nkabinde's special adviser meets with Madonsela to present a legal opinion from the State Attorney that the deal is enforceable. Madonsela urges them not to "attach weight" to such a "hastily prepared" opinion.

February 22 2011: Madonsela releases her findings into the Middestad lease and finds Cele guilty of "improper, unlawful" conduct.

May 8: Sunday Times exposes Shabangu as a frontrunner in a tender worth over R1-billion for the relocation of police provincial headquarters in Durban.

May 27: After months of trying, Madonsela interviews Mahlangu-Nkabinde, who agrees to stop the tender.

June 8: Madonsela sends her provisional report into the Durban lease investigation to the parties involved to respond.

June 19: Sunday Times reveals Madonsela's provisional findings.

July 14: Madonsela releases her final report finding that the Durban building was also improperly acquired.

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