Johannesburg - A looting spree scandal has rocked a multimillion-rand community development project in Ekurhuleni, with one company allegedly invoicing the city R22 000 for one steel bench.
An audit investigation has revealed that millions of rand were claimed for unrendered services. The preliminary forensic investigation report, which The Star has seen, states that at least three parks did not exist, yet money was claimed for them from the municipality.
The accountants state that at least 13 of the 112 wards in the Ekurhuleni Metropolitan Municipality were visited during the preliminary investigation.
At least R112 million is budgeted annually for community development for the Lungile Mtshali Urban Management Legacy Projects within the metro. Each ward is given R1m, and the Ekurhuleni metro has confirmed that there was an investigation into the matter.
“After receiving numerous complaints about the implementation of the projects in certain areas, the City decided to launch a preliminary investigation that has directed us to conduct a full investigation,” said City spokesperson Themba Gadebe.
“We are confident that this investigation will help us determine the right course of action against any persons implicated in any irregular activity. We cannot, however, divulge any further information at this stage,” Gadebe said.
Meodi Chartered Accountants state in their report that it was incumbent to review “some of the high-risk areas in order to determine if there was irregular, fruitless and wasteful expenditure”.
“The Lungile Mtshali Urban Management Legacy Projects programme had only spent 23% of its total annual budget by the end of May 2018, with only one month remaining before the end of the financial year.
“However, all of a sudden, a number of invoices were received during the months of June and July, which cumulatively escalated the expenditure to about 81%,” the report stated. Ten sites existed. However, work on nine of the 10 sites was either of poor quality and standard or was not performed as claimed on the invoices.
These invoices amounted to R3 957 294. Three of the sites do not exist, however, we noted that the service providers claimed to have delivered services at these alleged sites,” the report states.
EFF PR Councillor Fani Sibeko said he wrote to the city manager after it became clear that rampant corruption was taking place.
“In some instances, a company made the municipality pay R22 000 for a steel chair when five were supposed to be installed. Another claimed for grass when there was none. We want answers. We cannot allow people to continue looting like this. Action must be taken against those implicated,” Sibeko said.
The report states that Xamhunti General Trading Enterprise was contracted to do landscape construction on three sites – Ward 13 Birch Acres, Ward 89 Hospital View and Winnie Mandela, and Collins Park in Benoni.
The sites in Birch Acres and Benoni could not be found, however, invoices amounting to R52302 and R275721, respectively, were sent to the municipality. An invoice totalling R631637was sent to the municipality, according to the report.
“There was no park in Ward 13 fitting the description stated on the certificate,” the report reads. It further states that the company submitted “fraudulent” pictures for projects in Ward 13 and Ward 89 to illustrate work done. Another damning finding was against service provider Skiroo Construction and Projects, which was responsible for work in Ward 50’s Katlehong Park.
“We found that the service provider over-quoted the quantities he provided at the site. The discrepancies amounted to R227507.” The company was also found to have submitted “fraudulent pictures” to illustrate work done.
The report has recommended that Ekurhuleni consider instituting disciplinary action and criminal charges against all individuals found to have violated the Municipal Code of Ethics and Municipal Finance Management Act.