OR Tambo District Municipality on response plan to COVID-19; Suspension of municipal manager
10 July 2020
OR Tambo District Municipality COVID-19 Response Plan
The Committee had been convened to receive details of the Special Investigating Unit’s on-going investigation into the alleged counts of fraud, theft and corruption in the OR Tambo District Municipality. The Committee had asked the municipality to provide clarity on the circumstances surrounding the suspension of the municipal manager. The Committee wanted to be satisfied that justice had been served, and that this was not a case of victimisation.
The lack of mention of these issues in the municipality’s presentation was criticised from the outset of the meeting. There had been no reference to the corruption surrounding the four-day door-to-door Covid-19 awareness campaign which had resulted in a R4.8 million loss. This was highlighted as being the main reason for the meeting having been convened -- to give the municipality an opportunity to clear its name and to restore its residents’ confidence that the Covid-19 response funds were reaching the vulnerable. Members said that under the current bleak economic circumstances, no wastage could be tolerated, and the district municipality needed to work with the Committee to restore public confidence.
The Committee Members expressed concern at the lack of straight answers obtained from the municipality in response to serious and worrying questions on governance and procurement challenges the municipality was facing. The Committee decided to give the office bearers until the following Tuesday, 14 July, to submit written submissions to the Committee in response to Members’ questions, and these submissions had to be accompanied by evidence to enable the Committee to make informed decisions
Ms Thokozile Sokanyile, Executive Mayor: OR Tambo District Municipality, said the report served to update the Committee about the municipal COVID-19 plans and the expenditure incurred in relation to the activities undertaken. It also gave insight into the institutional arrangement that had been established by the district in coordinating Covid-19 mitigation plans.
Upon the outbreak of the COVID-19 pandemic and the declaration of a national disaster, the municipality had established a district command council chaired by the Executive Mayor. The structure was supported by a technical team chaired by the municipal manager (MM) with all sectors. Under the technical support team, there were various work streams. The two structures convened weekly and produced the reports to the province en route to the National Command Council. Each work stream developed sector-based plans that were aimed at mitigating the pandemic.
To date, there had been 6 702 reported Covid-19 cases, of which 3 423 were active. There had been 3 179 recoveries and 100 deaths.
There were five work streams:
Business continuity plan
The focus of the plan involved:
- Provision of personal protective equipment (PPE) for the essential services staff;
- Provision of health and hygiene material and sanitisers;
- Installation of sanitising equipment for the buildings;
- Decontamination of municipal buildings;
- Testing of the staff and councillors, as well as the provision of psycho-social support to them; and
- Communication about COVID-19, the integrated development plant (IDP), and budget compliance sessions.
To date, R4 326 939 had been spent on this initiative.
Disaster Risk Grant
The Municipality had applied for the disaster risk grant, as per COGTA requirements. An amount of R4.2 million had been approved, with specific activities to be executed:
- Provision of PPE for disaster staff;
- Supply of sanitisers for employees and vulnerable communities;
- Decontamination of public spaces; and
- Provision of a fumigation booth and lockable bins.
To date, R4 201 000 of the grant had been spent.
Water and Sanitation Operations
The water and sanitation services had been prioritised to ensure that the existing infrastructure was operated and maintained to provide an optimal supply of water. The plan ensured the provision of water tanks for the temporary supply of water, the continuous supply of water to the tanks, and improvement in the maintenance of water supply and dealing with sanitation blockages.
Water Grant Prioritisation
Projects had been earmarked for the refurbishment of non functional schemes and the equipping of boreholes and protection of springs as part of the Covid-19 budget ring-fencing and prioritisation, to enhance water access to communities for both consumption and hand washing. The municipality had reprioritised R131 million of its municipal infrastructure grant (MIG) allocation, based on the impacted expenditure by the pandemic, and National Treasury had approved R 89 million of the reprioritised allocation.
Food Support and Social Security
The municipality had supplied PPE items to areas affected by COVID-19, such as Majola in Port St Johns, such as water tanks, masks and 20-litre water buckets.
Mayor Sokanyile said the O.R. Tambo District Municipality was becoming the Covid-19 hotspot and epicentre of the province. The inequalities and lack of infrastructure had exposed the communities of the region. COVID-19 would impact more in the financial status of the municipality due to its rural nature and poverty.
Ms P Xaba-Ntshaba (ANC) asked about the episode of Cutting Edge aired on SABC1 a month ago in which members of Libode in Nyandeni, Eastern Cape, had been interviewed. The episode had revealed that this community was without water, so it was asked whether the people of Libode were covered by the district municipality’s water and sanitation operations plan, as outlined in the presentation. The mayor was asked to be specific about Libode’s prioritisation within the district municipality’s plan. It was asked which areas were being prioritised, and what would be delivered to these areas. If indeed the Libode community was catered for by the District Municipality’s Water Grant Prioritisation Plan, how many water tanks had been set aside for delivery to Libode?
Ms G Opperman (DA) referred to the Auditor General’s (AG’s) report on R1.4 billion in irregular expenditure, and asked what the main contributors to this were, and whether it was being investigated. Had R10.3 million been paid to Gcina Sonke Construction for the Mqanduli bulk sewer despite no work having been done? Had R9.9 million been paid to Khwalo Construction for the same sewerage works, despite no working having been done? Had Phoenix Tanks been paid R1 million to deliver tanks, and had those tanks been delivered? If not, why not? Had Valatone been paid R2.5 million to deliver tanks, and had those tanks been delivered yet? Was it true that R3 million had been paid to Phathilizwi Training Institution on 21 May and R1.8 million on 26 May for the door-to-door campaign? If so, who had signed off on the campaign? Had the campaign taken place? Was it true the Chief Financial Officer (CFO) who had refused to sign off on the illegal payments had hired bodyguards because he feared for his life? Was it true that the municipality had paid Amatola Water R133.9 million for unexplained advance payments without any work having been done?
Mr K Ceza (EFF) appreciated the fact that there was a Special Investigating Unit (SIU) investigation into the district municipality’s irregular expenditure of R1.4 billion. He did not believe the municipality had the capacity to investigate, even though it had in-house investigators. He asked what the capacity of the Municipal Public Accounts Committee (MPAC) was to pre-empt these issues before they happened. The Committee had not heard any positive response on this, and the Minister’s presence was welcomed so that she could see “these things for what they are.” The fact that the mayor had mentioned the provision of Jik sanitiser and Handy Andy, but not food support and social security, was ludicrous. What food support had the district municipality distributed and to which areas had food parcels been delivered? What resources did the mayor have at her disposal? The presentation had made no mention of food support, despite acknowledgement of the abject poverty faced by members of the community which the district municipality served.
He asked whether the suspension of the Municipal Manager (MM) had been done in haste. Had due process followed, in line with the Municipalities Act and the Municipal Financial Management Act (MFMA) in the suspension of the accounting officer accused of financial misconduct? Had the executive mayor had a forensic report regarding R12.6 million paid to Ruwacon for the supply of material to the signal hill in Mthatha, which remained undelivered to date? Had payments been processed?
He labelled the 100 Covid-19 related deaths as a cause for concern, especially the 72 in King Sabata Dalindyebo municipality. What resources were available to the mayor, considering the poor communities in the area who did not have proper shelter, adequate places in which to quarantine, or potable water? Was there a plan to prioritise poor communities to ensure that new infrastructure was implemented? The presentation had made mention of maintaining old infrastructure -- there was a need to build new infrastructure, such as the bridges that were needed in eMampondweni community. He asked whether there was a plan in place to give this community access to water, and how much of the budget was dedicated for this purpose. Had unexplained advance payments, in the amounts of R28 million, R91 million and R14 million, been paid to the Amathole district municipality for bulk sewer work? What had the district municipality been paid for?
Mr I Groenewald (FF+) indicated that, regarding local government legislation, the district municipality’s website was not up to date -- it had last been updated in 2015/16 financial year. Recent reports were therefore unavailable on the website. The executive mayor had alluded to the fact that upon finding out about the invoices to Phathilizwi Training Institute through social media, she had sought to find out the truth of these claims. After a day or so, the MM had been suspended. However, the mayor had told the Committee no report regarding these payments could be provided, and this report would be forthcoming. Why had the executive mayor suspended the MM if there was no report? In terms of the regulations, all emergency procurement that had been done throughout lockdown had to be tabled at the first council sitting – had this been done?
Ms H Mkhaliphi (EFF) said the Mayor’s presentation had not been clear on the suspension of the MM. Why had the suspension not been mentioned in the presentation. What were the reasons for the MM’s suspension? The day before the Portfolio Committee meeting, there had been a council sitting at which the EFF had proposed a motion to suspend the Director of Legislative Services on the basis that the R3 million could not be justified on the door-to-door campaign. The EFF had hoped that the district municipality would respond to that call. However, the council had decided that it needed to get more clarity, and suspension would not take place -- the director would be rather given leave. Why should the director be given leave? The R3 million given to Phathilizwi Training Institute was a very serious concern to the Committee. Why had the municipality opted to use a company? The programme of the municipality was very important, and everyone agreed that people should know about Covid-19 to be able to keep safe, but why had the municipality not hired volunteers from OR Tambo district municipality? This would have created opportunities for the unemployed, so it did not make sense for the Director to hire a company and pay such a large amount of money.
The district municipality was often in the media for negative reasons, and one of the things that had been said was that R170 million had been paid for bulk water services which had not been delivered. Had there been any investigation into this? Mr Ceza had alluded to the fact that there was a lack of capacity in the municipality to investigate itself, so had they asked national government to intervene to stop the corruption.
She asked how long the municipality intended to have the 888 water tanks, and how much it was paying for them per month. Who were the owners of these tanks? As one of her colleagues had mentioned, the Committee had received a report about OR Tambo District Municipality from the AG that reflected badly on it. This was not even surprising, however, due to the amount of bad press that this municipality received. Had they started an investigation into the issues raised by the AG?
Mr H Hoosen (DA) first made reference to President Ramaphosa’s announcement of a R500 billion Covid-19 relief package, stating that at the time there had been a general mood of gratitude that under such difficult economic circumstances the President was still able to make this money available to provide Covid-19 relief support. A large part of this money had been directed at municipalities for relief efforts and to prevent the spread of the virus. At the same time, however, there had been a level of scepticism that the money would not reach its intended beneficiaries. When one heard about what was going on in the OR Tambo district municipality, one understood why there were grounds for this scepticism. Although people were grateful, there was an expectation that as they proceeded through other stages of the lockdown, more and more of these types of instances would start emerging – allegations of corruption, especially when it came to supply chain management and tendering processes.
It was troubling to hear about what was going in the municipality. It was fascinating that the executive mayor, despite being aware that she was coming before the Committee to deal with corruption involving R4.8 million, had made no mention of this in her presentation. He wanted to know if there was a hold on that money, or whether it was still being spent on the door-to-door campaign. This amount of money, for 6 800 people, worked out at R750 per person. Mention of the irregular expenditure had been highlighted by the AG at another Portfolio Committee meeting. There were also other allegations of financial irregularities in this municipality – the R160 million given as advance payments to companies which still required an answer from the suspended MM, to get his version of the story.
Mr Hoosen said the leadership of the municipality was an embarrassment to the people of South Africa. Not by any stretch of the imagination could the Committee walk away from this meeting with any sense of confidence that the executive mayor, or her leadership, was doing what it was expected of it to address the difficult situation that the municipality found itself in. He criticised the mayor for deliberately leaving out details in her presentation, despite being aware that the Committee wished to investigate the money spent on the door-to-door campaign. He also highlighted that the mayor had left out detail surrounding the irregular expenditure, and had provided the Committee with globular figures of how much was spent on certain things. For example, the presentation had stated that R957 000 had been spent on non-touch thermometers, without informing the Committee how many units had been purchased for that amount. That detail was needed so that the Committee could give the oversight that was required.
He asked the mayor to address the particular two slides where she had referred to the purchase of PPE. The amounts of R780 000, R1.1 million and R132 000 had been spent on PPE without specifying what had been purchased. Had the municipality received value for the money it had received from the National Treasury? He asked about the sanitiser and fumigation booth bought at R1.2 million and R841 000, respectively, and whether it was a single fumigation booth that had been acquired at that price. He referred to the further R1.3 million spent on the testing of municipal staff and asked for the details of how many staff members had been tested at that price.
He said the Covid-19 relief package given to the municipality had been treated as an opportunity for municipal officials to line their pockets at the expense of poor people. He asked the mayor what responsibility she was going to take for what was going on, and to give the Committee the assurance that she was committed to turning this situation around – “to put the crooks in jail, and not in the council.” He was certain that the mayor knew who the crooks were, and asked whether she was aware of any municipal official who had directly benefited from tenders in the district municipality. This was an opportunity for the mayor to state whether she was aware and whether she was going to report these individuals. He asked the mayor to give the Committee an assurance that the district municipality had a mayor who meant business, and that if she chose not to state names at least that she would report any individuals involved in these dealings.
Mr Hoosen gave credit to the Eastern Cape MEC for writing to the President to send the SIU to investigate the district municipality, and said this was the type of leadership that was needed. He asked the mayor to replicate the same level of leadership as the MEC. He asked what she was doing to the fix this, and said that she could not rely on the MEC to deal with the issue -- she should have been the one to ask the President to investigate, or to approach the police to intervene. The mayor expressed no dissatisfaction in her presentation with what was going on, which gave the impression that to her, this meeting was to give just a simple report and that tomorrow all would be forgotten. From what he had heard, he did not get the impression that she was doing anything to fix the problem.
Regarding the requirement that all Covid-19 expenditure had to be reported to the municipality as well as the National Treasury, he asked whether the mayor had done this. Who in the municipality had a direct link to the Phathilizwi Training Institute, because nobody could be expected to believe that R4.8 million had been fruitful expenditure? Which official was benefiting from this company, and was this the first occasion that the company had received tenders from the district municipality? He asked her to make every effort to ensure that those individuals who were defrauding the municipality would not receive any other tenders going forward.
Ms D Direko (ANC) referred to the bad press that the municipality had been receiving, and asked what its reaction was to this matter. She asked what they would do to resolve this matter. Regarding the R1.4 billion in irregular expenditure, she asked what its reaction was and whether it had a financial recovery plan, and if not, why not? She asked for a breakdown of the R4.2 million in Covid-19 expenditure -- for example, the unit price of sanitisers and the quantity purchased, and who the beneficiaries were. She asked the mayor to provide details of all the costs the municipality had incurred regarding the Covid-19 expenditure. Had it followed the National Treasury’s regulations on Covid-19 procurement?
Mr B Hadebe (ANC) made reference to the report received from the AG titled, “Not much to go around, yet not the right hands at the till,” which he said spoke to the capacity of the people deployed in municipalities. The AG had highlighted that the OR Tambo district municipality had the highest irregular expenditure, and the practice had not changed. The AG had also said that the Eastern Cape had a high level of instability in key positions throughout the province’s municipalities.
In the OR Tambo district municipality, the practice of non-compliance was tolerated. This municipality had been democratically elected to fulfil the service delivery needs of the community. These issues of service delivery were related to water and sanitation infrastructure. It was a sad state of affairs, considering the ANC stalwart and struggle icon after whom the municipality was named and the fact that there a district development model had been launched from this municipality. It was meant to be leading by example. Over and above the SIU investigation, had the municipality taken any initiative to investigate the R1.4 billion in irregular expenditure as identified by the AG? If they had done so, it should provide the Committee with the latest details.
Regarding the issue of the suspension of the MM which had been making headlines, he wished to determine the measure of procedural fairness exercised. He referred to the Municipal Systems Act regulation, section two, which governed the disciplinary code and procedures of senior managers, which stated that “if a senior manager was alleged to have committed misconduct, the municipal council must institute disciplinary proceedings in accordance with the disciplinary code of schedule two. Over and above that, it must be done in accordance with the good code of practice provided for in schedule eight of the Labour Relations Act no. 66 of 1995. The Act further stated that the principle of natural justice and fairness must be adhered to at all times – not withstanding criminal or civil action having been constituted.” The rule of natural justice, the rule of audi alteram partem applied, and no one should be condemned unheard. He asked the executive mayor to detail to the Committee step-by-step the procedural steps that the municipality had taken in suspending the MM.
What was the cause that had lead to the suspension? He was raising this, as section five was clear that any allegation of misconduct brought against a senior manager must be tabled within the municipal council within seven days. It was explicit that the municipal council could not suspend any senior official without first giving them an opportunity to make representation. Once he or she had made the representation, the council must further afford itself an opportunity to interact with the representation and weigh the balance of probability. Only then could the council come to a decision to suspend the MM. He said that it needed to determine whether procedural fairness had been applied in dealing with this matter, as everyone was innocent until proven guilty before the court of law. It could not afford a situation where some were given leave, and others would be suspended. Yet there were those who had signed on the dotted line a hand-written invoice to the amount of R4.5 million. He asked where else one had seen an invoice of that amount. He asked for the executive mayor to give the summary of expenditure of the municipality regarding the food support and social security work stream.
Mr G Mpumza (ANC) referred to the episode of “Cutting Edge,” in which people from Libode in Nyandeni, Eastern Cape, had been interviewed. These people were isolated, did not have access to services, and needed a bridge. He asked whether this community had been accommodated in the municipality’s plans for the provision of water and access roads. He referenced the Municipal Finance Management Act’s provision for vigorous reporting monthly, and asked whether these provisions were being applied in the municipality. Were the governance structures ensuring monitoring, oversight and accountability as required by the Act’s provisions? He related this to the report made by the Auditor General, which highlighted the municipality’s high level of irregular expenditure. He asked why the financial management in the municipality was not effectively applying section 71 to manage expenditure.
He asked the mayor what the timelines were, as the indication was that the municipality was using Amatole Water for bulk water supply. What was the nature of the memorandum of understanding (MOU) between the municipality and the company, and why was this company the only service provider? Amatole Water was the sole implementing agent. He asked what the timelines were for the MOU, and how often the municipality reviewed the status of this implementing agent. Where was the supply chain management on this issue? He referred to the hand-written invoice, the director of legalisation, and the service which had been paid for but not delivered, and asked where the chief financial officer (CFO) was in relation to these issues and who was authorising all of them. Was there even a CFO in the municipality, and if there was, did he or she have the requisite skills?
Mr M Nhanha (DA, Eastern Cape) said that he wished to talk about the director having asked for leave, the suspension of the MM, the invoice of R3 million, and the water tanks.
On the issue of the director taking leave, he submitted that there had been a motion to suspend the director of legislative services. This motion had ‘bullied’ a certain number of councillors and as a result, a big compromise had been reached. Instead of the director being suspended, she was told to take leave -- and the Committee knew very well the difference between the two. In the case of suspension, there were restrictive measures, but if one was given leave, there was less restriction. He asked for the mayor to comment on this issue.
Regarding the suspension of the MM, he said the DA in the district municipality had previously raised suspicion of alleged corrupt activities on the part of this individual. He said that “because it was convenient for the ANC caucus in OR Tambo, they had closed ranks around the MM.” Suddenly, without the knowledge of the mayor, somebody else had been appointed acting mayor in her presence and officiated at a meeting which sought to present a report that wanted to suspend the MM. The mayor could confirm this with the Committee. While the mayor was in quarantine, an interim mayor was elected in order to process report which sought to suspend the MM. He asked whether it was true that initially the MM had been suspended without the mayor’s knowledge, and asked what had happened since.
He brought to the Committee’s attention that the municipal manager had been held in high esteem with ANC councillors, and that his suspension had arisen only five days after he had refused to sign the handwritten invoice for Phathilizwi Training Institution. He asked the mayor for her view on whether there was a link between the suspension of the MM and his refusal to sign the Phathilizwi invoice.
He had written to Minister Lindiwe Sisulu and Minister Dlamini-Zuma regarding the issue of the water tanks on behalf of the DA in the OR Tambo district municipality. The municipality had bought 800 water tanks for the district, but eight to ten tanks had been distributed to the communities and remained in the yard of the chief whip of Ingquza Hill municipality. There were photographs that could be provided to the Committee. They had been there for two months.
Regarding the issue of the director of legislative services, most people on the attendance register who claimed they had been spoken to, had said they had not seen Phathilizwi in their area. Times Live had run an article on this. This included a ward committee member who lived in Port St. Johns whose name was on the list, but no one had come to her to tell her anything about COVID-19. He said that this was blatant fraud.
Ms C Visser (DA, North West), said it was horrific to see the level of corruption and fraud with such important things like the COVID-19 relief package. She shared the other Member’s concern that the report given to the Committee by the mayor did not cover everything. She referred to the report that was presented in council by acting mayor Robert Nogumla on 17 June that detailed how the municipality allegedly paid out more than the R168 million to companies, some of whom had not done any work. This included three unexplained advance payments to Amatola Water of R133.9 million, R12.6 million to Ruwacon to supply material to Signal Hill in Mthatha, which was yet to be delivered. R10.3 million to Gcina Sonke Construction for the Mqanduli bulk sewer, which also was yet to be delivered. R9.9 million to Khwalo constructions for the same Mqandule project without work having been done, R2.5 million to Valatone Construction to deliver water tanks although there was no evidence the company delivered them, and lastly, R1 million to Phoenix Tanks to deliver water tanks, though there was no evidence the company delivered them.
She proposed a thorough forensic investigation into this municipality due to the amount of unexplained and unsubstantiated payments made by it. She pointed to the municipality’s Municipal Infrastructure Grant (MIG) reprioritisation plan, and said that there were large projected costs without significant evidence that these were not inflated, due to lack of detail. She referred to the refurbishment and equipping of existing boreholes in the presentation, and asked how many would be drilled for the prices quoted. She called for the Committee to be presented with a thorough investigation into the municipality as soon as possible.
The Chairperson said her questions were informed from the Standing Committee on Public Accounts (SCOPA) meeting she had attended in the morning. She referred to the report from the AG, as mentioned by Mr Hadebe, which highlighted that the R1.4 billion spent by the municipality accounted for 39% of the total irregular expenditure in the Eastern Cape. The municipality had not planned adequately for the procurement of their goods and services. This had resulted in many deviations occurring, particularly within supply chain management. In numerous circumstances, emergency procurements had been made without adequate justification, which had been labelled a trend in the municipality by the AG. The municipality had been awarding several infrastructure tenders without correctly-constituted adjudicating committees, which was a clear indication of people by-passing the supply chain legislation. The AG had noted that the irregular expenditure of this municipality could be potentially higher than it was currently thought to be, because it did not have controls in place to correctly identify and disclose all prior irregular expenditure. This brought the Committee back to the leadership in the municipality, which was a cause for concern.
On the issue of the suspension of the MM, she asked whether there was a report which had been presented in the municipal council about the allegations of financial mismanagement. She asked the members of the OR Tambo municipality to explain to the Committee whether they were aware of any criminal cases which had been opened in this regard. Regarding the procedural aspect, as raised by Mr Hadebe, she asked whether notices had been issued of the intention to suspend the MM prior to his suspension. If so, had the MM responded to them?
On the issue of the invoices, which had been raised at the inter-faith religious meetings held in May, she asked for clarity on who the director responsible for the procurement of these meetings had been, and whether any payments were made to that effect. She asked the executive mayor for a breakdown of the R1.4 billion expenditure. How many water tanks had been delivered to the municipality from national government in response to the pandemic? How many were still lying in the yard of the municipality’s chief whip, as Mr Nhanha had submitted? She was raising this as OR Tambo was the water authority as a district. How many water tanks had been installed? Was there a system whereby water tanks were being filled? Did the municipality have a CFO, and if so, what his or her qualification was that would allow for such a large amount of money to be lost.
She wanted to know if there was an expectation that when the municipality received grants from national government, they had to spend the entirety of those grants. According to the reports, there had been a lot of under-spending in the municipality when it came to grants, amounting to R157 million in relation to the municipal infrastructure grant (MIG). She also referred to under-spending of R71 million of the water services infrastructure grant (WSIG), of over R12 million on the Drought Relief Fund, and R36.6 million on the regional bulk infrastructure grant (RBIG), She asked how these things could under their watch.
The AG had highlighted in his report that issues in municipality had come from previous financial years. She said this was the result of a lack of consequence management, and the way they had dealt with disciplinary measures to favour certain groups. She cautioned that if they did not lead with a top-down approach, there would always be room for people to run wild. She asked for the leadership of the municipality, including the project management team (PMT), the Member of the Mayoral Committee (MMC) for Finance, and the chairperson of the Municipal Public Accounts Committee (MPAC) to explain what was happening in the municipality. The status quo left much to be desired. She asked the members of the Municipality to take collective responsibility for the R1.4 billion in irregular expenditure with which it was faced.
OR Tambo District Municipality response
Mayor Sokanyile referred to the summary of the expenditure in the report, and said that the numbers had gone down. For example, the provision of PPE for essential services had been R957 000, not R1.1 million. The numbers in the presentation for the supply of non-contact thermometers, PPE, the fumigation of all municipal buildings and the testing of municipal staff and councillors had been written incorrectly. The correct total was R4 326 938.67. She said they would submit a breakdown of every item, including the unit cost.
On the issue of Nyandeni’s lack of access to water, as seen in the episode of Cutting Edge, she replied that the municipality had plans with the Municipal Infrastructure Support Agency (MISA) for water provisioning, but a road must be constructed. She was from Nyandeni, and had been its mayor. During that time, they had initiated a plan to construct a road into the area, but the soil had been loose which had caused the grader to fall. The municipality of Nyandeni had been penalised by the Department of Environmental Affairs for attempting to create a road there. The district municipality had had discussions with a few families from Nyandeni who were ploughing marijuana in this area, because the soil was too loose. There were plans for water provisioning, but first there needed to be a road constructed to the 19 families who lived in that area.
She addressed the issue of paying contractors for services which had not yet been delivered. She said the district municipality was being taken to court by some of these contractors on defamation charges. Upon receiving the report about contractors being paid, she had tasked the MM with responding to these allegations within two days. She had then taken his responses to the MEC and to the municipal council. Amatole Water was the implementing agent for regional bulk infrastructure from the King Sabata Dalindyebo Presidential intervention (KSDPI). The amount involved was R266 million, which was implemented by Amatole Water, whose contract ended in 2021.
She had contacted the suspended MM to ask for a report on the Ruwacon issues. When she approached the Mayoral Committee with the report in order to determine what action they were going to take, there was already an action by the council, with a report from its portfolio committee, which was playing an oversight role. The district municipality was being piloted by a separation of powers by the executive. The MM had been suspended once those issues were tabled by the council. The MM had taken the district municipality to court on issues of procedure, so she was unable to comment further on this matter.
Mayor Sokanyile answered regarding the invoices to Phathilizwi Training Institution were written by the director of legislative services, and were circulated on social media. The suspended MM had not paid Phathilizwi, and had written back to the director requesting an explanation regarding how the door to door campaign had occurred. These responses had not been received, however. She had contacted the acting MM to request that they act regarding the director. She wished to follow the right procedure by compiling a report about what was happening, and the authenticity of the invoices. This report had been delivered to her the day before this meeting had occurred. At a council meeting, the director had requested leave so that the council could act on those invoices. The council had agreed to that request, although she had already instituted some measures. The director was in fact on leave currently.
The council had indicated the need for an independent investigation into the Covid-19 expenses and irregular expenditure. She referred to the MPAC report, which emphasised the need to investigate the irregular expenditure. The mayoral committee had agreed that they must analyse the expenditure quarterly. The municipal disciplinary board’s terms of reference stated that every official who incurred an irregular expense must be held accountable. The report had been postponed due to the lockdown, but it would be brought to the next council meeting in the third quarter to look at the irregular expenditure. Most of the irregular expenditure of R1.4 billion had come from the supply management procurement processes of the municipality. She had met with the CFO and asked for a report as to why the municipality had incurred such a high expenditure and had requested the acting MM to institute an investigation into all the issues.
Mayor Sokanyile said she had called Amatole Water once the district municipality had found out that the grants would not be spent. On the issue of allegations, she had requested Amatole to be deputised so that it could explain to the council if they were advancing the money to the contractors. Most of the time, they were the people who were at fault.
The Chairperson interrupted Ms Sokanyile, asking her to answer the call for clarity on the unexplained advanced payments to Amatola Water of R133.9 million, as there was agitation amongst the Committee members.
Mayor Sokanyile replied that she would get the MM to explain, as he had already submitted a report on this point. She would submit a written report to the Committee. It was the same report which had been tabled by the deputy mayor at the council meeting at which the MM had been suspended.
The Chairperson interrupted Ms Sokanyile again to ask if she had any knowledge of these advance payments.
Mayor Sokanyile said she did not have the capacity to investigate, so she had requested the Department of Cooperative Governance and Traditional Affairs (COGTA) to assist.
The Chairperson asked Mr Robert Nogumla, Deputy Mayor: OR Tambo, to comment on the advance payment, as the person who had implemented the suspension of the MM.
Mr Nogumla’s connectivity was not stable, so several of his points were inaudible.
He said that when Amatole Water approached the council and urgently requested the suspension of the MM and for the council to launch an investigation into criminal elements, this had led the council to open an independent investigation into the issues. The case was currently on-going. It had been opened by the acting MM, and was being led by the Hawks. The suspended MM’s cell phone and computers had been seized as part of the investigation.
A Committee Member asked why the mayor had said two different things -- that she was investigating the matter, and when asked what her findings were, had said she had not completed the investigation. He asked how the mayor was assisting the Committee to get the information.
Mr Nogumla replied that he did know why the mayor had said that, because the district municipality had been involved in the process. He believed that the problem was that on the day of the council meeting, the executive mayor could not connect to the virtual meeting.
Mr Nhanha raised a point of order, saying that the deputy mayor had claimed that officials could not reach the mayor whilst she was in quarantine. Lying to the Committee was a criminal offence. The truth, which the mayor could verify, was that the mayor had said she was able to perform her duties. The deputy mayor and members of his own cabal had called a council meeting at which a report which sought to suspend the MM had been tabled.
The Chairperson said that in municipalities where there was an absence of the mayor, standing orders allowed the deputy mayor to assume the responsibilities of the executive mayor. She called on the Speaker of the council to comment on whether there was a legally constituted council that had dealt with this matter. She also asked the mayor and deputy mayor to tell the Committee whether the report that Ms Visser had presented was tabled to the council, and whether it had formed the basis for the suspension of the MM. Had the council complied with its own rules and standing orders? She had already asked whether the MM had been given notice.
Mr Nogumla said that he had been appointed in the council because the council had been unable to get hold of the executive mayor. He was given all the reports that were meant to be tabled to present to the council and that was what he had done. The Speaker would answer the rest of the questions.
Mr Xolile Nkompela, Speaker: OR Tambo District Municipality, provided a timeline of events regarding the Director in question, Ms Tseane. He said her husband had passed away due to COVID-19, and she had also tested positive for the virus. Whilst the council was convening, Ms Tseane was at home and reported that her son had tested positive for COVID-19.
He replied to Mr Nhanha’s submission that the chief whip of Ingquza Hill municipality had water tanks in his yard. He said that the council Committee had resolved the issue by ensuring that the water tanks were distributed at the beginning of May. He confirmed that criminal cases were opened and that the law agencies were doing their work.
He also confirmed that the council was convened properly. The reports were appropriately tabled by the Chairperson of the Committee, and the report on Amathole Water was tabled by the Chairperson of the committee for water and sanitation, Councillor Gusana. The council had sought advice from their legal adviser, and he adjourned the meeting when they were report about the executives. He referred to the municipal legislation which allowed the deputy mayor to assume the executive mayor’s duties if the executive mayor was absent, or if there was a vacancy. The council had elected the deputy mayor to act as the executive mayor in that council, and the process had been properly followed.
In responding to the question about whether letters were sent to the MM, he asked the Committee to agree on what the executive mayor had indicated -- that this matter was sub judice. The deputy mayor was the second respondent, and he was the third respondent. The suspended MM was part of this debate, and the matter was before the courts. He asked the Committee to allow the municipal official to submit written responses, as the matters being presented here were part of the arguments which would unfold in the legal case.
Mr Ceza interjected that this should not be allowed to happen, and said that the Speaker was wasting the Committee’s time.
The Chairperson asked Mr Ceza to not allow his emotions get the better of him, and requested that he talk through her as Chairperson. She was aware that the matter was in court, and the Committee would respect that it was sub judice.
Speaker Nkompela responded to the issue of processes. He said the precautional suspension which was placed by the council on the MM was done so a case could be opened. Once the case was opened, the precautional suspension had been lifted. Once the suspension had been lifted, the council had received letters in an unusual way. On a Sunday, the council had been informed that it was supposed to appear before the court in Port Elizabeth, because the MM had taken legal action against them. Lawyers were hired to represent the institution, but not the second and third respondent -- the deputy executive mayor and himself. However, it was the suspended MM who had taken the council to court and he had assigned the lawyers to represent the same council.
Mr Hadebe called for a point of order, as the Speaker was moving on without giving the Committee the sequence of events which had led to the MM’s suspension. He asked the Speaker, as the presiding officer, to provide the Committee with what happened blow by blow.
Speaker Nkompela said that what transpired in the council was that the MM had been suspended on the spot, but he had been given notice that he could challenge his precautional suspension if he found the municipality to have acted unlawfully. The MM had never challenged this. He reiterated that when the case was opened, the council had lifted the precautional suspension, but two resolutions had been taken that day. The first put him on the precautional suspension in order for the council to elect an acting MM to open a case. The second was to give the suspended MM a letter to respond to why he should not be suspended, which he had to respond to within seven days. On the 26th, when the council noticed through the report presented to it, that the suspended MM had never responded, it extended the deadline until Monday at 16:00, but still the MM did not respond. The matter was before the court on the 30th, and the council was afforded the opportunity to find its answering affidavit, which it had done.
He replied to the question raised about whether the director was given leave by the council. This was not the case. The director was the council secretary. The council wanted to get a report on the invoice. The director had given an answer, but also indicated that she had heard about the invoice. The report was submitted to the office of the MM, who wrote to the Speaker and told him that while the director was busy with the report, her husband had passed away from COVID-19 and that she herself had tested positive. She had sought clarity, and the matter was urgent because it dealt with corrupt activities on which the council was focusing.
The reason for the MM’s suspension was the unexplained advance payment of R168 million. He had presented this before the troika and suggested that the members of the troika go and visit the projects. He had visited all the projects. He said that the council could not investigate on its own, and needed the involvement of the police.
The Chairperson asked if Speaker Nkompela had gone by himself, or if he went with members of the troika.
Speaker Nkompela said that he went first with committee members, and then he returned with the troika. He had requested that the troika Members go to the nearby project, but they had not. The reasons for the MM’s suspension were reflected in the presentations by the committees.
He said that council took a sober decision the day before this meeting to investigate Phathilizwi Training Institution, especially with regard to its appointment. It had agreed to investigate all COVID-19 expenses. As the representatives of the district municipality, they were deeply concerned by the issues raised by the AG regarding irregular expenditure.
He clarified that the leave requested by the director was not an alternative to suspension.
He stated that in the council there was no cabal, as suggested by Mr Nhanha.
Mr Hoosen asked the Speaker whether the door to door campaign done by Phathilizwi Training Institution had emerged from the Speaker’s office. Where had the company got its instruction to do its work? He asked whether the invoices had come from his office to the MM. Somebody must have given them an instruction. Did it come from the Speaker’s office, and who would have been involved in that project?”
Ms Mkhaliphi said that the Speaker had spoken about the processes and reasons for the suspension of the MM. She asked why it had been difficult to suspend the director of legislative services on the same basis of corruption that the council had suspended the MM. The council had taken a decision to have Phathilizwi Training Institution black-listed, and to not receive any further work from the municipality. Who gave the instruction to the director to sign the Phathilizwi invoices? Why was the director not being investigated, if they were so consistent in fighting corruption?
Mr Nhanha said he wished to tell the Speaker that lies and the truth did not mix. The Members of the Committee were receiving one-sided information, and the other leaders in the municipality had a responsibility to provide the council with additional information. The Speaker had misled the Committee regarding the mayor’s incapacitation. Being tested positive for Covid-19 did not make one incapacitated, and he had it on good authority that the mayor had convened two mayoral committee meetings from her home. The chief whip and the Speaker had used the mayor being quarantined to by-pass the mayor, and had convened a council meeting which ended up on their own accord. They had nullified a council meeting at which they had presented a report, and had taken decisions on the objection of the DA. Seven days later, the chief whip and Speaker had convened another council meeting to suspend the MM. He asked the Speaker who had written the letter to suspend the MM, and who had written the appointment letter to appoint the acting MM? All these events had occurred around 17 June.
Mr Ceza referred to a meeting which was meant to take place on 22 June, and said that if it was properly constituted, why had the disciplinary action against the MM not been instituted?
Ms M Tlou (ANC) referred to the presentation, which stated that there were 888 water tanks and only 785 had been installed. It had been mentioned that some water tanks were at a councillor’s house. How were they going to deal with this issue? Regarding the suspension of the MM and the issue of the R168 million which he could not account for, she asked what the outcome was of the investigation the municipality claimed to have done into this issue.
Mr Groeneweld asked whether the Committee could request the municipality to supply it with a portfolio of evidence including all correspondence, reports, and the investigation that they had begun. He suggested that the Committee would be more assisted by getting evidence in writing. He asked the municipality to supply the Committee with the signed contracts of procurements in order to see who had signed for them, and who was therefore responsible.
The Chairperson agreed with Mr Groeneweld that this would assist the Committee.
Ms Xaba-Ntshaba asked which areas had been prioritised in terms of their plans for Covid-19. She referred to Libode in Nyandeni, and asked whether they had been catered for.
Mr Hadebe proposed that the Committee receive all the records of the meeting which had taken place on 17 May, and they should include all the reports that were meant to be tabled by the mayor. The mayor ought to verify that those reports as presented by the deputy mayor were authentic and a truthful representation of what was meant to be presented. A detailed procedural sequence of events that led to the suspension of the MM needed to be provided to the Committee in writing.
The Chairperson asked the mayor to provide a written breakdown of the COVID-19 expenditure. She asked the executive mayor, deputy mayor, the chief whip, the Speaker, the MMC finance, the CFO, the chairperson of MPAC, the MM and the acting MM to all submit separate reports on all the matters discussed at the meeting, including the suspension of the MM, the R1.4 billion irregular expenditure, and the Covid-19 relief package. She suggested doing site visits of the projects mentioned in the meeting. She asked the MM to submit his version of the circumstances surrounding his suspension in writing, and the chairperson of MPAC to confirm whether the committees were functional.
Commenting on the amount of work that needed to be done, she said she wanted the Committee to give these matters the attention that they deserved. The Committee would invite the SIU. She requested that the Director-General and Deputy Minister provide the Committee with a preliminary report of what COGTA was doing nationally, and said the anti-corruption unit needed to brief the Committee. She gave all the municipal officials until Tuesday, 14 July, to submit their reports in writing to the Committee.
Mr Hadebe asked for a submission from the MEC of local government, to establish whether the council had notified the MEC seven days after the suspension, in line with the regulations. The Committee needed to hear what the outcome of of this notification was.
Mr Groeneweld said that the report must include a proof of evidence (POE), all communications, investigations and reports that the officials had received.
Mr Hoosen asked the mayor to give a breakdown of the COVID-19 expenditure -- what the municipality had spent the money on, and the exact details.
Ms Mkhaliphi asked for the evidence of the open criminal cases that had been mentioned. What were the names of the truck owners hired to distribute water tanks? She asked for a profile of the Phathilizwi Training Institution, and said that whoever had coordinated the public participation programme had to answer as to why they had opted to hire a private company.
Mr Ceza asked the mayor to provide the Committee with a comprehensive plan for the municipality’s food support and social security.
Ms Xaba-Ntshaba requested a written statement about service delivery to Libode in Nyandeni.
Ms Tlou asked the municipality to include in their report details of the homeless shelter in the municipality, and the quarantine sites.
The meeting was adjourned.