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Cash-strapped Eastern Cape council not liable for unlawful R5m Covid-19 awareness campaign

The Special Investigating Unit has succeeded in forcing the struggling OR Tambo District Municipality in the Eastern Cape not to pay almost R5 million to a company claiming to have conducted a Covid-19 door-to-door awareness campaign in 2020.

The Special Investigating Unit has succeeded in forcing the struggling OR Tambo District Municipality in the Eastern Cape not to pay almost R5 million to a company claiming to have conducted a Covid-19 door-to-door awareness campaign in 2020.

Published Jul 1, 2022

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Johannesburg - A struggling Eastern Cape municipality was on Wednesday handed a lifeline after the Special Tribunal ordered it not to pay for an unlawful R5 million Covid-19 door-to-door awareness campaign.

Special Tribunal president Judge Lebogang Modiba ruled that the cash-strapped Mthatha-based OR Tambo District Municipality was not liable to pay two tax invoices Phathilizwi Training Institute issued totalling over R4.85m for conducting door-to-door Covid-19 awareness campaigns.

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The Special Investigating Unit (SIU) uncovered irregularities in the dodgy tender while conducting its probe into Covid-19-related procurement authorised by President Cyril Ramaphosa in 2020.

According to Judge Modiba, the SIU found that Phathilizwi Training Institute, which is based in Hillcrest, Mthatha, had initially been awarded a contract to conduct a community outreach programme to encourage communities to participate in municipal programmes with full understanding of local government processes.

This was extended after the outbreak of the coronavirus in South Africa early in 2020 to include the door-to-door Covid-19 awareness campaign.

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However, the SIU found irregularities in the extension of the tender.

Phathilizwi charged R660 per person per day and claimed to have reached 4 112 people in the municipality.

The company also claimed that it utilised 12 field agents and one supervisor to render the services but, Judge Modiba found, it told the tribunal that it only incurred salaries for eight employees.

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”It makes no reference to the 13 persons who conducted the training as reported in the training report. Neither does it explain on what basis were the five employees that appear not to have been remunerated performed the services. At best, these versions are contradictory,” the judge added.

The extension of Phathilizwi Training Institute’s tender to conduct the Covid-19 awareness campaign in the OR Tambo District Municipality was declared unlawful and set aside by the tribunal.

In addition, the tribunal held the company liable for the SIU’s legal costs.

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Phathilizwi’s sole director Phumza Gambula and the municipality’s whip services manager Phumzile Gwadiso are currently out on R20 000 and R50 000 bail, respectively, after they were charged with fraud.

The Hawks accuses Gambula of submitting fraudulent documents to the Port St.Johns Local, King Sabatha Dalindyebo and Mhlontlo local municipalities, which are in the OR Tambo district, claiming she conducted door-to-door Covid-19 awareness campaigns for the prevention and containment of coronavirus.

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