LIVE FEED: State Capture Inquiry – September 22, 2020
Johannesburg – The Zondo commission will hear further testimony on Tuesday morning regarding corruption allegations related to a R1 billion Free State housing project.
The inquiry will hear testimony from the former head of the Human Settlements Department, Mpho Gift Mokoena.
On Monday, the former Free State head of human settlements, Nthimotse Mokhesi, took the stand.
Mokhesi’s appearance centred on an affidavit he wrote while he served as head of department and sought relief from the courts for the department recoup more than R600 million that was paid to various suppliers and contractors to build 14 000 RDP houses for the province’s citizens.
Mokhesi has explained that R600m was paid to suppliers and contractors in a fraudulent scheme devised by former human settlements MEC Mosebenzi Zwane and then head of department Gift Mokoena.
In late 2010, the department had found itself in a position to lose the bulk of its R1 billion housing budget. National Treasury regulations stipulate that a department’s budget can be recouped from a province if not spent within a given financial year.
The national human settlements minister at the time, Tokyo Sexwale, had aimed to recoup the Free State department of human settlements’ budget as it seemed like the province would not meet its target of spending the budget. At the time, in October 2010, only 10% of the budget had been spent.
Zwane and Mokoena were said to have approved payments to suppliers and contractors in a scheme to ensure that the housing budget was not recouped by the national department and redistributed to other provinces, which had met their spending budgets.
The evidence leader for the commission, advocate Paul Pretorius, explained that the scheme entailed agreements with 135 building contactors and prepayments were made to these contractors before the final products were received.
What made these payments illegal was that procurement processes state that contractors should be responsible for acquiring building material and once the first phase of the project was completed, the contractor could begin claiming from the department – through proper checks and balances.
This process did not happen.
Another illegal component of the scheme was how the department settled agreements with 112 suppliers for building material to be delivered to the appointed contractors.
This meant that the department was taking responsibility for building material being supplied to contractors.
Mokhesi told the commission that this was illegal as it went against the first agreement with contractors which stated that they were responsible for ensuring that building material was supplied.