Where is the R20 million paid for unlawful desalinisation plant?

Issued by Vicky Knoetze, MPL
Shadow MEC for COGTA

More than a month after the Grahamstown High Court set aside the controversial and unlawful tender awarded to Quality Filtration Systems (QFS) for the Port Alfred Desalination Plant, and instructed QFS to repay the R20 million already illegally paid out, there is still no money in the municipality’s coffers.

I will fight hard to roll back the frontiers of corruption in the Eastern Cape and ensure that residents can live a life of value.

The tender was set aside due to the unlawful administrative actions by the Ndlambe Local Municipality, who advertised a bid for a 2ML reverse osmosis plant to be developed on the banks of the Kowie River in November of 2019. The Municipal Manager simply ignored the prescribed minimum scores for functionality.

The court also found that the actions of the Municipal Manager was tainted by impropriety and irregularity, rendering the whole process nugatory.

Judge Zilwa said it was “rather shocking and difficult to comprehend” that the municipality rushed to pay QFS R20 million, even before the written contact had been signed by both parties. No tangible explanation was tendered for this unusual situation.

The court ordered that QFS must affect restitution, and repay the R20-million to the municipality, as it is not entitled to benefit from an unlawful contract.

This still has not happened.

I have now written to the MEC of COGTA, Xolile Nqatha, to express extreme concern that the Ndlambe Municipality has not been able to recover the money from QFS. It is also extremely concerning that the municipality might not be able to rely on legal prescripts in terms of contract law, as no contract was signed at the time of the transfer of the funds to QFS – an action that was highly irregular and unlawful by the Municipal Manager.

In light of these concerns, I have requested that MEC Nqatha intervenes and tasks the municipality to pursue other avenues to recover the funds.

This should include implementing section 176 (2) of the Municipal Finance Management Act, which allows a municipality to recover loss or damage suffered from an official, due to deliberate or unlawful actions of such an official in performing their functions of office.

If the Municipal Manager, who authorised the payment of the R20 million to QFS without any contract in place, cannot get the money back from QFS, he must be held personally liable and repay the funds himself.

The Democratic Alliance has, for the third time now, officially requested that the matter be referred to the Special Investigations Unit (SIU).

On 10 July an official request to have the SIU investigate the matter was submitted to Premier Oscar Mabuyane, and on 23 July, a second formal request was made during a sitting of the Provincial Legislature.

To date, there has been no confirmation that the matter has been referred to the SIU.

While the ANC may feel that the loss of R20-million of the public’s money is not worth investigating, the DA believes that the full might of the law should be brought against those responsible for this malpractice and maladministration and, where relevant, criminal proceedings should be brought against those individuals.

The matter is in the interest of the public and a pivotal part of the investigation will deal with securing and recovering state assets and public money.