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The Limpopo education department irregularly increased by R19 million the budget of EduSolutions – a stationery supply company at the centre of the province’s textbook crisis.
The latest forensic reports have revealed that the cash-strapped department – which accumulated unauthorised expenditure amounting to R2.2 billion and failed to order school textbooks last year because it was bankrupt – had spent millions of rand on accommodation for employees who never attended workshops.
The department apparently also increased the value of the contracts of two infrastructure development companies by between 57 percent and a whopping 161 percent through variation orders, according to the two independent reports in the possession of The Star Africa.
Compiled by forensic auditing firms last month – one by Gobodo and the other by Deloitte, NEXIASAB& T – the reports added that the department had approved payments that included “fraudulent claims for discount” by EduSolutions. The provincial education department and four others were placed under administration in December after the Limpopo Government was plunged into a R2bn cash-flow problem, which has since been stabilised.
The education department, which had been allocated more than half of the province’s R43bn budget for the 2011/12 financial year, had accounted for much of the cash-flow crisis.
Gobodo recommended that 64 senior officials, including chief financial officer Martin Mashaba, be charged with financial misconduct for “irregular procurement process of the kit and the approval of purchase orders from EduSolutions”.
According to the Deloitte report, JJ & Company’s R18m contract to rehabilitate storm-damaged schools in the Mopani and Sekhukhune districts was “progressively increased through variation orders, to R47m”.
Baknozi Proj & Moago Construction’s tender’s “initial contract value of R14m was revised by 57% to R22m”, of which R4m was paid and R18m committed.
These were the only two project management files containing all supporting documents supplied to the auditors by the department. Deloitte had requested 10 files for quantification of commitments.
EduSolutions is a subsidiary of African Access Holdings, a politically connected firm that previously entered into a partnership with the Jacob Zuma Education Trust. The decade-old stationery supply firm, whose seven directors are mainly former senior government officials, has scored lucrative contracts in Limpopo, KwaZulu-Natal and Gauteng believed to be worth R1.7bn.
Despite the irregular budget increase, EduSolutions repeatedly failed to supply stationery as part of its R320m tender, causing scores of Limpopo pupils to go without textbooks six months into the year.
Provincial ANC deputy chairman and MEC Dickson Masemola, seen as Zuma’s ally, centralised the distribution of textbooks after taking over in May 2009.
The Limpopo textbook crisis has led to a tug-of-war between Basic Education Minister Angie Motshekga, who is in charge of the Limpopo education department, Joburg NGO Section 27, teacher unions, opposition parties and members of the public.
They accused Motshekga of failing the Limpopo pupils and violating their constitutional right to education, a charge she has repeatedly denied.
This came after the national basic education department failed to meet the initial court-imposed June 15 deadline to supply textbooks in Limpopo.
The deadline was shifted to Wednesday, but the South African Principals Association in the province said some schools had not received books by the second deadline.
EduSolutions’ lawyer, Ian Small-Smith, dismissed the forensic report as “nonsense” on Thursday.