DURBAN - THE eThekwini Municipality is set to act against employees implicated in the looting of funds meant to procure Covid-19 essentials for the city.
The City Integrity and Investigations (CIIU) has been given one month to produce investigative reports and provide the names of implicated officials.
This, after the city’s external audit committee chairperson Nala Mhlongo tabled a report detailing the city’s expenditure on Covid-19 essentials, in an executive committee meeting yesterday. This was the second report on the matter, the first report was tabled in December and there were complaints that it had incomplete information.
The report tabled appeared to be largely the same as the previous report, with changes only to some amounts.
It found that the municipality could have suffered R11.1 million in financial losses, due to officials’ failure to comply with regulations.
This potential financial loss, which is still under scrutiny by the city, was as a result of an overpayment of R10.7m for personal protective equipment (PPE). The city had, in total, spent R85 million on PPE procurement.
The remainder of the potential financial loss was R402 000, which was spent on the procurement of hampers and vouchers. The city had spent about R67 million on this function.
Among the procurement problems was that the city officials had not aligned the municipal procurement process to the guidelines set by National Treasury.
The report said, in addition, the city could have also incurred R75 million in potential irregular expenditure.
Councillors across party lines yesterday demanded implicated officials be disciplined and, if need be, reported to the police for criminal prosecution.
The report detailed numerous instances where officials appeared to have been negligent or complicit in wrongdoing.
At least one official hastily resigned when the municipality started scrutinising the procurement process.
Among the issues was that there had been an ineffective process regarding how companies were invited to bid for contracts to provide PPE.
“There is a lack of evidence of an advertisement for a formal invitation of quotations for seven days or less on the council website and official noticeboard.
“The invitations to quote were sourced using the following methods – e-mails, WhatsApp, telecommunication and through referrals. In the absence of substantiating evidence, the process to invite quotations in a fair and transparent way was compromised,” said Mhlongo.
Other issues included:
– Procurement of infra-red digital thermometers, amounting to R 2 350 000, revealed that the original signed reports for thermometers were approved by the accounting officer on May 11, 2020, but they were not provided to internal audit at the time of audit, and were subsequently provided on November 20, 2020.
– There was also non-compliance to general pre-condition requirements – an award was made to the supplier with an expired BBBEE certificate, resulting in irregular expenditure of R51 600.
– There was potential cover quoting, as it was noted that the director name and contact information was common for two suppliers.
– Some of the invoices that had been paid were not stamped as paid, which increased the risk that one could be paid twice.
– The report also found there was a lack of document management controls, which hindered the progress on the audit.
Mhlongo said one of the more serious irregularities was that some invoices were sent to the city before the requisition of goods.
“This is more serious, how can there be an invoice before the requisition, how did they (suppliers) know we needed goods?”
Mayor Mxolisi Kaunda said the CIIU had one month to provide reports on the allegations.
“We can't allow people who have stolen from the municipality to walk free, breathing the same air that we breathe.
“We know that when the investigations started, one employee resigned. We must open a criminal case against that employee. Just because they have left the municipality, that does not mean we should not take action against them,” he said.
Kaunda added that he had initially feared that the theft was much worse.
IFP councillor Mdu Nkosi said it was unacceptable that the municipality could not keep track of documents.
“There really must be consequences for the officials that have been implicated in the acts of wrongdoing.”
DA councillor Thabani Mthethwa said there were officials in the supply chain department, that had been arrested on different allegations of corruption, who were back at work.
“It cannot be that you do procurement this week and the following week you have no documents. We are told that some of these quotes were sourced through WhatsApp,” said Mthethwa.
Speaker Weziwe Thusi echoed the calls that officials implicated in wrongdoing should face consequences.
She said councillors had also failed to provide her with reports regarding the distribution of food parcels, which had contributed to this item being flagged by the Audit Committee.
The Mercury