Elite investigators called in over R1.4bn irregular spending in Eastern Cape

Bring in the Special Investigating Unit.

This is the call from Eastern Cape premier Oscar Mabuyane to President Cyril Ramaphosa. The premier wants the SIU to dig into allegations of R1.4bn in irregular expenditure at the troubled OR Tambo district municipality - and also claims of irregularities over a Covid-19 tender.

In the letter dated Tuesday July 7, Mabuyane said the R1.4bn was identified in the latest auditor-general's municipal audit outcomes. Statistics released by auditor-general Kimi Makwetu 10 days ago show that irregular expenditure across the country increased from R25.2bn in 2018 to R32.06bn last year.

The elite investigators, Mabuyane said, should also investigate allegations that in May the council paid R4.8m to Phathilizwi Training Institute for a door-to-door Covid-19 awareness campaign.

On Sunday, the Sunday Times reported that Phathilizwi had invoiced the municipality for R4.8m after the company had claimed to have conducted a door-to-door campaign that reached 6,400 people.

“The allegations of impropriety relate to matters of irregular expenditure amounting to R1.4bn as contained in the auditor-general’s report for the 2018/2019 financial year, as well as suspected corrupt practices within the municipality, as widely covered in the media within the past few days,” said Mabuyane in the letter. 

“In order for the allegations to properly investigated and ventilated, I request that the honourable president tasks the Special Investigating Unit to investigate the allegations of impropriety in the affairs of the OR Tambo district municipality.”

The investigation is in the public interest and is intended to secure state assets and public money in that municipality, said Mabuyane.

“I shall be pleased to discuss any concerns the honourable president may have in this matter," he added.

A fresh invoice, seen by TimesLIVE, seems to show that Phathilizwi billed the council for conducting Covid-19 awareness classes for 5,000 community members. The invoice is undated.

The company claimed to have conducted the May door-to-door campaign in:

• Majola in Port St Johns;
• Hole in the Wall and Tubase in King Sabatha Dalidyebo municipality;
• Libode and Ngqeleni in Nyandeni local municipality; and
• Etwa in Mhlontlo municipality.

The company’s director Phumza Gambule could not be reached for comment.

On Saturday last week, the municipality’s spokesperson Xolile Nkompela told the Sunday Times that the council had launched an investigation into Phathilizwi’s campaigns.

“All such campaigns are managed in my office, but I cannot say if this did take place and what was done. I was assured that this matter has not been paid,” Nkompela said at the time.

He promised to involve law enforcement agencies should corruption be detected.

“My office wants to root out all corruption in this institution.”