Lesedi Municipality ’acted on its own’ to award R7bn aerodrome tender
Johannesburg - The Gauteng provincial government has assured provincial political parties that it had no role in the awarding of the R7 billion Aerodrome Project, saying the Lesedi Local Municipality ignored treasury regulations and allegedly invited competitive bidders to apply for the project, which had no business plan.
This was the shocking revelation made by Oupa Seabe – chief executive of the Gauteng Infrastructure Financing Agency (Gifa) under the provincial Ministry of Finance – at the meeting of the legislature’s portfolio committee on finance.
The Gifa and the Lesedi Local Municipality signed a Memorandum of Understanding in 2019 for the construction of the Aerodrome Project, which was earmarked to create job opportunities for local and major construction, especially those involved in aeronautics. People living around Heidelberg and neighbouring towns were also targeted for job opportunities.
The municipality was set to inject revenue for itself after the opening of the project.
However, Seabe told the portfolio committee that Gifa was dealing with the Lesedi Aerodrome Project but when the Lesedi Local Municipality advertised the project with flimsy terms of references, they withdrew because there was no proper business plan for it.
Seabe also said that the action of the Lesedi Local Municipality’s officials “was irregular” and the Gifa did not want to be part of that project because they knew it would result in a bad product.
“We told Lesedi Municipality that they are putting the cart before the horse. We told them that we are pulling out as we could not be held accountable for their own actions. They just wanted to complete this project quickly,” Seabe said.
Lesedi Local Municipality mayor Lerato Maloka did not respond to several requests on Seabe’s submission before the portfolio committee, including allegations that they had bypassed the government and produced “flimsy terms of reference” for the project.
“This was the second time they wanted to go on their own. During the first time, the National Treasury informed them that what they were doing was wrong. The Treasury instructed them to approach us and we should work together on the project. They then again invited bidders without informing us. There was also no business plan for the project,” Seabe said.
Reacting to Seabe’s revelation, Gauteng DA’s spokesperson on finance, Adriana Randall, said it was concerning as it meant that the entire Aerodrome Project was illegal, considering the Lesedi Local Municipality decided to defy the council resolution on the Memorandum of Understanding with the Gifa.
“In addition, the municipality did not follow the Public Private Partnership regulations as set out by the National Treasury. No transaction adviser was appointed or registered for the project with the National Treasury. The views of the National Treasury were also not solicited for this project.
“No feasibility studies as required have been conducted for this project, but a 60-year lease has already been awarded to MTP Aviation Solutions, who received a letter via WhatsApp to inform them that they have been successful in tendering for this project,” Randall said.
She said if the project was “disposed of” via the Municipal Transfer Regulation process, then the process was just as flawed, since only seven of the eight requirements of these regulations’ requirements have been met thus far, yet the project was already handed over to MTP during a function last Friday (February 12).
“For any municipal property transfer contract exceeding 10-years, a Notarial Contract is required, and the council must approve of such draft agreement. To date no such draft agreement has been served before council either.
“I have already tabled written questions in the Gauteng Provincial Legislature to the MEC for Finance regarding the Lesedi Aerodrome Project. It is unacceptable that a R7 billion project will not benefit the Lesedi Local Municipality but only some politically-connected individuals,” Randall said.