Public Works spends R200 to hire a glass

Dodgy service providers working in cahoots with rogue civil servants are swindling the government out of billions of rands, Deputy Public Works Minister Jeremy Cronin said in parliament yesterday.

In some instances, service providers leased drinking glasses to the department, for use during official functions at the presidential guesthouse in Pretoria, at R200 each.

Cronin was briefing a joint meeting of parliament's standing committee on public accounts and the public works portfolio committee on what his ministry was doing to root out corruption in the embattled Department of Public Works.

He said the department had incurred more than R3.6-billion in irregular expenditure over the past four years through the flouting of procurement processes in the leasing of office buildings, including the Middestad office block in Pretoria, in which axed national police commissioner Bheki Cele and businessman Roux Shabangu were implicated.

Though 200 allegations of financial misconduct between 2009 and 2013 were investigated, only 15 had been referred to the Special Investigating Unit and the police .

Public Works director-general Mziwonke Dlabantu said 89 internal investigations had been concluded and that management had yet to decide on what action to take against implicated officials.

About 29 other cases of corruption could not be backed up with irrefutable evidence, he said.

Cronin said "tenderpreneurs", working in collusion with corrupt officials in the department's prestige unit, had billed the government R200 for the use of a drinking glass each time the government hosted a function at the presidential guesthouse.

This meant that the department would fork out R60 000 a night just for the hire of glasses.

"Overzealous officials" were to blame for the overpricing of goods and services, Cronin said.

"It was picked up late last year. [But] I don't have the facts before me as to how long it had been occurring ... It's a smallish indication of, at the very least, a lack of diligence when departments tender for services. One doesn't know but there could be more behind it than a lack of diligence. But whatever way, it's unforgivable."

Cronin was quick to point out that "The Presidency categorically had nothing to do" with the matter.

Public Works chief financial officer Cox Mokgoro said it was clear that some of the department's officials had colluded with service providers. Mokgoro said the matter was now the subject of an investigation by the Special Investigating Unit.

The prestige unit of the Department of Public Works is responsible for managing the presidential guesthouse, ministers' houses in Cape Town and Pretoria, and the parliamentary villages housing MPs, among others.

Director-general Dlabantu had earlier presented shocking figures to MPs, including:

Fruitless and wasteful expenditure of R239-million between 2009 and 2012, being rent for buildings the department did not occupy;

Irregular expenditure of R1.5-billion in the 2012-2013 financial year alone. This includes the SA Police Service leasing of the Middestad office building. The figure for the past four years is R3.6-billion.

An estimated R670-million was spent in contravention of stipulated supply-chain management procedures;and The department wasted R4.9-million on value added tax paid to non-VAT vendors.

Themba Godi, chairman of the standing committee on public accounts, said: "The figures are quite staggering, to say the least. It makes for depressing reading. Certainly people do not do these things for nothing; there are personal benefits that accrue out of it."