29 January 2013

South Africa: Cosatu's Response to Minister's Statement On Nkandla

The Public Protector, Thuli Madonsela, says her office will find out if public money was abused in the R206 million presidential residence upgrade ... ( Resource: Public Protector Launches Nkandla Probe

The Congress of South African Trade Unions welcomes the statement by the Minister of Public Works, Comrade Thulas Nxesi, about the money spent on the President's residence at Nkandla, and appreciates his assurance that "there is no evidence that public money was spent to build the private residence of the President or that any house belonging to the President was built with public money".

COSATU does not question the need for the state to take adequate measures to secure the President and other public office bearers. This is a norm everywhere in the world.

But COSATU is shocked that the Minister's task team confirmed that R71 million was spent on security upgrades and that a total of R206 million of public money has been spent on this project. For the government to spend such a grotesque amount of public money on any one person is shocking and grossly insensitive to the workers, the poor and the homeless.

Those who are found to be behind this gross misuse of public funds must be held accountable, including any political office bearers who approved the use of these massive amounts of public money.

The amounts that the minister now concedes were spent vindicate our decision to ask the Public Protector and the Auditor General to investigate them to check if each of them can be morally justified.

We also note with great concern that the minister's task team uncovered evidence of "a number of irregularities with regards to appointment of service providers and procurement of goods and services" and of "various malpractices around non-adherence to supply chain, financial regulations and controls".

He says that "the Supply Chain Management policy and prescripts were not fully complied with in procurement of goods and services in the project" and gives the example that "the Treasury Regulations allow for a variation from an initial procurement order only up to 20%, but that in this case this was not observed."

COSATU welcomes his decision to refer these allegations of "irregularities" - by 15 service providers and consultants who were contracted by Public Works to render various services ranging from bullet proof windows, security fence construction and many other services - to the Special investigating Unit, the Auditor General and the South African Police Service, with a view to investigating any possible acts of criminality.

We call for the publication of all the names of all the service providers, including the names of their directors and shareholders. In particular we want to be assured no government official, including political leadership, is conflicted and or has benefited from what appears to be massive inflation of prices.

This call does not in any way suggest that we want to know what upgrades were conducted in a manner that will undermine the security of the President. The public protector should satisfy herself that price of every item is consistent with market prices. We reiterate our call that that government officials involved with supply chain management should be subjected to lifestyle audits, and that seems to be the best thing to do under these circumstances.

The federation calls on the Ministry of Public Works and the Public Protector to focus on the role of the contracted companies and investigate whether there was any corrupt collusion with public officials, or officials using their own companies, in the inflation of prices for the work done.

COSATU repeats what is said in its earlier statement – that rural development, which is one of the ANC government's five priorities, must be implemented regardless of who will benefit and that Nkandla should not be prioritised but treated just like every other rural community.

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