The lawyer representing two former Transnet executives linked to alleged corrupt procurement processes involving disposable breathalyser straws remained tightlipped on Wednesday after the Special Investigating Unit (SIU) and the state-owned entity blocked their pension benefits.
In a joint statement, the SIU and Transnet said they had received an order from the Special Tribunal to interdict the pension payouts due to two former Transnet executives who had been linked to fruitless and wasteful expenditure of about R33.5 million.
In terms of the Special Tribunal order dated October 23, Judge Lebogang Modiba ruled that the Transnet Retirement Fund was interdicted from paying out the pension benefits of former executive manager responsible for group business continuity and disaster management Lerato Mary Theresa Makenete, and former executive manager for safety, Landela Hawkins Madubane, amounting to R8.9m.
The pension funds would remain interdicted pending the finalisation of an application to be brought against the former executives and others.
Mafona Ramothwala, who represents Makenete and Madubane, said he had been instructed to not speak on the matter until it had been finalised in totality.
An investigation by the SIU into the affairs of Transnet found that Makenete and Madubane allegedly colluded with three service providers to abuse Transnet's emergency procurement process during Covid-19.
Transnet said it had called on the support of the SIU to investigate the matter involving emergency procurement processes at the height of the pandemic in April 2020, when Transnet contracted -Ramoyadi Air Conditioning, Ndzalo2 Trading, and Eagles Ropes to deliver over a million disposable breathalyser straws.
The SIU found that Makenete and Madubane allegedly colluded with suppliers to defraud Transnet by inflating the price of the straws from R0.29 per straw to R29.99 per straw, resulting in a total payment of R33 834 698.40.
“The SIU and Transnet have instituted civil action in the Special Tribunal to review and set aside the contracts and recover financial losses suffered by Transnet due to overpayment of approximately R33.5 million.”
The SIU also recommended Transnet institute disciplinary proceedings against the two.
Transnet said they actioned the referral. However, both Makenete and Madubane failed to appear for the disciplinary hearings. The proceedings continued in their absence and the duo were found guilty and dismissed.
“The order of the Special Tribunal is part of the implementation of SIU investigation outcomes and consequence management to recover financial losses suffered by State institutions because of corruption or negligence. The SIU was, in terms of Proclamation R23 of 2020, directed by President Cyril Ramaphosa to investigate allegations of corruption, maladministration, malpractice and payments made by State institutions relating to personal protective equipment (PPE) procurement together with the conduct of State employees,” the joint statement by the SIU and Transnet read.
Trade Union Federation, Cosatu welcomed the order.
“We welcome any measure that deals with anybody implicated in corruption, especially senior management. The auditing amendment act was passed by parliament a few years ago and it empowers the state to freeze the assets of any official implicated in criminal activity. We've been frustrated that they have not utilised this power given the level of corruption across the state in particular at Transnet.
For us this is a positive shift, we hope it will lead to successful prosecution and recovery of stolen assets of the state,” Cosatu spokesperson, Matthew Parks said.
The South African Transport and Allied Workers Union (Satawu) said: “As we speak we are fighting for this state owned entity not to be privatised. As a result of corruption, R35m is a lot of money that could've been used to buy new equipment and refurbishing the damaged parts in all the ports.
Now you have incompetent executives who failed to perform their duties and are still expecting so much money?
“We are currently engaging with the Minister of Public Enterprises, we have all agreed to bring back/appoint executives who are capable of rescuing Transnet. This should be a lesson to everyone at Transnet, that we will not tolerate any form of corruption and incompetence.”
The United National Transport Union (Untu) said it strongly supported the SIU’s decision to take civil action against employees and officials to recoup at least some of the money plundered from Transnet.
“The union believes that it is crucial to hold those responsible for the looting of Transnet accountable, especially since the entity is still struggling to recover from state capture and the rampant fraud, corruption and looting that took place during the peak of the Covid-19 pandemic.
The entire country’s economy has been affected, and the livelihood of Transnet employees is at stake if the entity does not change its situation, start performing and start delivering positive financial results.”
General Industries Workers Union of South Africa president Mametlwe Sebei however said the action was a slap on the wrist, as only their pension and not all their assets had been frozen.
“If you’re going to leave a man without a pension but still a millionaire, what message are you sending?”