Conflict of interest casts doubt on Samwu probe

Published Sep 10, 2014

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Johannesburg - The four members of an internal task team that “cleared” the embattled leadership of the South African Municipal Workers’ Union (Samwu) in the alleged disappearance of R136 million from union coffers had a clear conflict of interest that casts new doubts on their probe.

The four, all provincial secretaries of the union, were paid generous “acting allowances” backdated to September 2012, alongside the union’s general secretary and his deputy.

This means the six officials are due or have already been given lucrative lump-sum payments that will cost the teetering union’s coffers another R501 000. The Star has seen documents detailing these payments.

The four beneficiaries of the union’s largesse are Limpopo provincial secretary Simon Mathe, Free State secretary Dumisane Magagula, Northern Cape secretary Duma Lebakeng, and KZN secretary Jaycee Ncanana.

The backdated lump-sum payments for the four range from R36 000 to over R45 000 each.

But the biggest beneficiaries of the scheme will be Samwu’s general secretary Walter Theledi and his deputy Moses Miya, who stand to be paid out R172 000 and R160 000 respectively.

The two are already at the centre of a financial scandal dogging the country’s largest municipal workers’ union.

The lump-sum payments relate to pension contributions paid to secretaries of the union.

According to union policy, elected officials should receive a contribution of 18 percent of the secretaries’ basic salary.

But instead, the leaders will now apparently receive pension contributions which include their acting allowances, which they receive for carrying out official duties.

No known central executive or national executive committee decision has authorised the huge increases.

Last week, the four provincial secretaries called a press briefing to present the findings of their own internal probe into the union’s finances, following allegations of impropriety and misuse of funds that have split the union down the middle.

A group calling itself Save Our Samwu (SOS) has alleged that R136m of the union’s funds have either been misspent or are not adequately accounted for. Though the task team never made their report public, they made much of its conclusion that there was no misappropriation of the union’s funds.

They accused SOS and other detractors of the leadership of being “financially illiterate”.

SOS, furious at what they call the task team’s “whitewash”, have called for an independent auditor to scrutinise the union’s books.

Among many areas they want to see probed are several “unauthorised” payments to a financial consultant employed by the union. The consultant, Samuel Phaswane, has been investigated by the Hawks and called in for questioning by the Joburg Specialised Commercial Crime Unit.

Documents show Theledi’s basic salary to be about R17 200. His acting allowance appears to be about R43 000 a month. His pension contribution from the union, based on just his basic salary, would be about R3 000.

But according to signed letters, dated June 6, a decision would appear to have been taken calculating the pension contribution based on the combined figure of the basic salary and the large acting allowance, taking Theledi’s figure to R10 900 a month.

In addition, the increased contributions are backdated to September 2012, which is when Theledi and his leadership clique took office. As a result, Theledi has either received or will receive a lump sum of over R172 000, according to documents in our possession.

Theledi, who had offered to show his payslips to the media, confirmed the payments, saying they “applied to all the secretariats in the union”.

Magagula denied that back-payments of R45 000 would be paid or had been paid to him.

“There’s no resolution in the union for retrospective increases. I don’t know where the figure of R45 000 comes from,” he said.

Besides the call account, a group of sidelined leaders from Samwu’s highest echelons say:

- R28m was mysteriously transferred from the union’s reserve account for admin expenses that were already budgeted for.

- A photocopy contract was awarded to a company, costing R6.4m - despite a recommendation to the contrary by the union’s finance committee

- That Samwu national officials have allowed at least R32.7m to be spent on renovations to its Joburg office without it being authorised. This amounts to R19m over the R14m budget which was approved.

- And millions have been paid to the consulting firm that Phaswane works for, Mpamba Solutions, which even allegedly authorises payments from the union to its own account.

The Star

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