Turning public sector contracts to private profit, Limpopo premier Cassel Mathale has built a multi-million-rand business empire that extends beyond the borders of his province – and cuts to the heart of the ANC administration.
The Sunday Independent can reveal that, via Manaka Property Investments, Mathale has a close business relationship with Thaba Mufamadi, chairperson of Parliament’s finance committee and former MEC for economic development in Limpopo.
Manaka lets a substantial portfolio of buildings in Pretoria to government departments, allegedly at inflated rates.
Earlier this month Finance Minister Pravin Gordhan placed troubled Limpopo under administration after it emerged the province’s treasury was effectively bankrupt and Matahale’s administration was seeking R2 billion from national funds just to stay in business.
At the same time law-enforcement agencies, including the Hawks and the Special Investigating Unit, are engaged in intensive investigations into alleged corruption, tender rigging and a rampant culture of kickbacks and impunity that appears to have precipitated the economic meltdown. Mathale, a former ANC Youth League strongman, is a key ally of suspended ANCYL president Julius Malema, whose affairs in Limpopo make up a significant focus of thegovernment’s forensic sleuthing.
Manaka Property Investments’ portfolio of leased buildings includes a welter of government buildings in the administrative capital, Pretoria.
Included in the list are buildings occupied by the Departments of Public Works, Water Affairs and Home Affairs, as well as Statistics SA and the Independent Electoral Commission (IEC). Manaka also lists the Gauteng Social Development Department as one of its tenants.
The Pretoria buildings listed on Manaka’s website include Manaka Continental Building (water affairs), Manaka House (public works), Hallmark Building (home affairs) and Manaka Heights.
Insiders say politically connected outfits like Manaka use a formula in costing property deals with government agencies, whereby market rates are upped by a third to maximise profits at taxpayers’ expense.
While Manaka declined to provide details of just how much they charge, estate agents with knowledge of the property leasing sector told the Sunday Independent Manaka charged prices well above current market prices.
Both Mathale and Mufamadi have declared their interests in their respective legislatures’ disclosure regimen. But it has yet to be answered how a company connected to key public officials in the province came to be awarded the contracts – in defiance of the treasury’s Supply Chain Management regulations – in the first place.
Asked for comment, Mathale said even though he is still a shareholder, he is no longer active in the company and has not received any payment from it. “Even if I was still active, there would be no conflict of interest because I declared my interest,” said Mathale.
Mufamadi referred questions to Manaka’s CEO, Joe Mathebula. Mathebula confirmed that Mathale is a shareholder in the company, but claims he resigned as a director after he was appointed premier in March 2009.
“However, there were delays in processing his resignation because of Cipro requirements,” said Mathebula this week.
He said Manaka Property Investment was unapologetic about doing business with the state because the government is a “big player” in the property sector and is key for transformation.
Another key business partner in the Manaka web of influence is businessman and property billionaire, Jannie Moolman, the former chairman of the Limpopo Tender Board who was appointed by Mufamadi when he was MEC.
During his tenure, insiders say, Moolman awarded a number of tenders to companies belonging to another key Limpopo power player, multi-millionaire businessman Jimmy Kourtombellides. Kourtoumbellides and Moolman are joint directors of Leopont 213 Properties (Pty) Ltd.
One of the tenders awarded to Phamog Properties cc – 50 percent owned by Kourtombellides – was for the construction of the department of agriculture building in Polokwane. Phamog Properties gave the building contract to one of Moolman’s companies, Jan Moolman Bouers, just after he resigned from the tender board.
However the construction site displayed signs indicating the work was being done by a company called Vision Construction, secretly operated by Moolman.
This came to light when Nortje’s secretary, as is recorded in an affidavit in the possession of the Sunday Independent, called the number given to the department by Vision Construction and Moolman answered the phone.
Before Moolman resigned from the Limpopo state tender board, he also sold a luxury Pretoria home for R1.4 million to Mufamadi, the politician who appointed him, at what is understood to have been a significant discount.
Moolman denied he had any sinister relationship with Mufamadi and Mathale.
Following the national government’s take-over of Limpopo in late 2011, Gordhan said there was “sufficient evidence that there have been attempts at sabotaging service delivery to blame non-delivery on the national government” last week.
That got a Joburg property developer and former associate of Moolman, Francois Nortje, going. He e-mailed Gordhan, asking why it had taken the government so long to act against corruption in the face of numerous complaints. He had complained of the allegedly corrupt relationship between Mufamadi and Moolman to the subsequently disbanded Directorate of Special Investigations.
Instead, Nortje said, Moolman tried to sue him for defamation.
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