Monthly Archives: October 2011


Zuma fires ministers, suspends police chief

Monday, October 24, 2011 1 Comment by Zelda

President Jacob Zuma on Monday announced the second Cabinet reshuffle of his term, announcing replacements, among others, for Sicelo Shiceka, minister of co-operative governance and traditional affairs, and Gwen Mahlangu-Nkabinde, public works minister.

The president also suspended Bheki Cele, the national police commissioner, with immediate effect, pending the outcome of a commission of inquiry into a controversial police lease deal involving the police chief and Mahlangu-Nkabinde.

Zuma had been under pressure to act against Shiceka, Cele and Mahlangu-Nkabinde after they were found to have acted improperly by the public protector.

Cele will receive his full salary and other benefits while on suspension, while Major General Nhlanhla Mkhwanazi will act in his position.

The board of inquiry into the police lease deal will be led by retired Justice Yvonne Mokgoro, alongside advocates Terry Motau and Anthea Platt, Zuma said.

Thulas Nxesi, the deputy minister of rural development and land reform, has been appointed as minister of public works.

Minister of Public Service and Administration Richard Baloyi was appointed to replace Shiceka, who went on sick leave in February this year. While he was on leave, Thuli Madonsela, the public protector, found him guilty of misspending about R1m on hotel accommodation and a trip to Switzerland, allegedly to visit a girlfriend imprisoned for a drug-related crime.

Madonsela reported that Shiceka had lied about the nature of his trip to Switzerland, which cost the taxpayer R546864, and that he had wasted more money on two stays in Cape Town’s luxury One&Only hotel.

She gave Zuma 60 days to take “serious action” against the minister, who had been on sick leave since February yet continued to travel domestically at state expense. She said Shiceka had also booked into the Lesotho Sun hotel for four days in March and insisted his department pay the R357120 bill with an accommodation voucher.

The public protector said last week that she and her team had tried to find evidence to explain Shiceka’s actions. “We did try and look for evidence in favour of the minister … to explain his conduct … but I couldn’t find any,” she said.

Earlier this year, in two reports on leases for police accommodation in Pretoria and in Durban totalling almost R2bn, the public protector also found that Mahlangu-Nkabinde and Cele were guilty of maladministration and illegal actions in approving the leases.

Zuma did not take questions from reporters following Monday’s announcement.

Credit to: Sam Mkokeli from Business Day

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Tolls put on ice – for now

Monday, October 24, 2011 No Comments by Zelda

The minister of Transport, Sibusiso Ndebele, has put the brakes on all work on the country’s controversial national toll roads’ project, saying there was a need for an extensive and all-inclusive consultative process with members of the public.

The minister ordered the South African National Roads Agency Limited (Sanral) to stop all toll road processes – including those in Gauteng – to make sure that all interested parties, be they groups or individuals, have their say on the project.

Work on the toll routes – the Gauteng Freeway Improvement Project, the Wild Coast and the Cape Winelands Toll Highway Project has already started and is estimated to run into billions of rands.

Infrastructure is already in place along the Gauteng N1 Freeway.

Transport Department spokesman Tiyani Rikhotso said on Sunday the need to stop all processes on the tolling project temporarily had been brought about by the realisation that there was a lot of interest in the projects and people still had to give their views.

“We want to proceed with a clear conscience, we want all views to be heard, we must play our role as a government that consults and not one that pushes decisions down people’s throats,” said Rikhotso.

He said it was only right that the people from whose pockets the money to service the debt government had already incurred for the project should have a say.

Forty two electronic toll gates have been erected on Gauteng’s N1, N3, N12, N17, R21 and R24. The tolls cover a distance of about 185km.

After an outcry over the initial charges, the cabinet approved reduced toll tariffs for the Gauteng freeway improvement project and agreed that light motor vehicles would pay R0.40/km, medium vehicles R1/km, “longer” vehicles R2/km and bikers R0.24/km. Qualifying commuter taxis and buses would be exempted.

There would be a 31 percent e-tag discount, a time of day discount available, and a frequent user discount for motorbikes and light motor vehicles fitted with an e-tag.

However, amid continuing unhappiness, the Transport Department announced earlier this month that a task team had been formed to look into the issue of toll roads and would include, among others, Ndebele and Finance Minister Pravin Gordhan.

Sanral corporate communications officer Priya Pillay said: “Sanral will continue to serve the interest of the economy and focus on the creation of quality jobs and the development of our communities.”

She said they were faced with the challenge of ensuring that the arteries of the economy were well maintained and adequately funded. They hoped to find a sustainable solution under the leadership of the minister which would ensure that the appropriate financial instrument would be appropriately applied.

”We welcome the statement from the minister, which clarifies the situation and the leadership he has provided in what is a challenging situation with respect to the funding of the national road network of South Africa,” Pillay said.

In Gauteng e-tag outlets are already visible in a number of shopping malls and members of the public were expected to start registering for e-tag accounts next month. Toll collection was expected to commence in February.

Rikhotso said the temporary stoppage would not affect the other processes like the training of personnel to man the toll gates and other staff issues.

Ndebele, Rikhotso said, felt that the good road infrastructure needed by the country should not place a financial burden on the shoulders of the consumer.

Conceding that the first phase of the Gauteng Freeway Improvement Plan had delivered good road infrastructure, he added that it was also an expensive exercise which had drawn sharp views from the public.

“We’re excited by the fact the Gauteng legislature has taken the initiative and has consultations around the toll issue scheduled for later this month,” Rikhotso said.

He said they were hoping to see similar processes, of consultations with individuals and formations, being started across the country.

Accusations around the lack of consultation and participation have been levelled at the government since the inception of the idea, and it has seen accusations ranging from the destruction of natural flora and fauna to the impact on poor communities adjacent to the toll zones.

In Gauteng objectors felt that the urban toll tariffs would harm consumers by increasing food prices and cause unnecessary financial strain on road users.

The Automobile Association called for all toll projects to be scrapped because of higher fuel prices, the effect of the recession on motorists’ cash flow and the high cost of collecting the money.

Although there were no timeframes yet within which the consultations would have to be completed, Rikhotso said they would be set out as soon as all parties started setting up discussions.

Pillay said that Sanral, as an implementing arm of the Department of Transport, would continue to implement the policies of government to the best of its abilities.

Credit to: Pretoria News and Independent Online

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Legislators to grill Gauteng mayors

Friday, October 21, 2011 No Comments by Zelda

In what can be regarded as a victory for disgruntled ratepayers, the mayors of three Gauteng municipalities will today be hauled before the provincial legislature’s petitions committee to explain why they failed to deal with residents’ complaints.

The three mayors are Tshwane’s Kgosientso Ramokgopa, Ekurhuleni’s Mondli Gungubele and Emfuleni’s Greta Hlongwane.

Committee chairman Jacob Khawe said the mayors faced being charged and, if found guilty, fined or sentenced to six months’ imprisonment if they failed to appear before the committee.

He said the committee worked similarly to the Office of the Public Protector. Established by the Petitions Act, it has the power to subpoena anyone in contempt of its authority.

Khawe said Ramokgopa would have to explain why he did not resolve the problems of the residents of Boikhutsong and Soshanguve, who in February last year complained of not been provided with water and electricity.

“We’ve been having discussions with Tshwane [metro officials] since that time. [But] those people are still sitting without water and electricity,” Khawe said.

He said the metro had also been unable to resolve its billing crisis.

Hlongwane will be grilled about her council’s decision to attach and sell the house of a resident who owed R44000 in rates and taxes.

“The homeowner took them to court and the court ruled that [the council's] decision was illegal,” Khawe said.

The council promised to resolve the dispute by August.

“We wanted them to pay the equivalent of what her house is worth or give it back to her. But, by September, they still hadn’t done so. That’s why we finally decided to call the mayor to account,” said Khawe.

The legislators will also grill Gungubele about his council’s treatment of a Thokoza resident who had leased a piece of land from the municipality.

“They allowed him to build a house and toilet. Now, after eight years, they want to evict him,” he said.

Khawe said the committee was determined to get tough.

“We’re not going to be lenient on people just because they are ANC comrades,” he said.

“If people are not happy with service delivery, they can petition us. They can also use us as a form of recourse. How long should people complain until they are heard?”

Credit to: Times Live

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R400m to upgrade official residences

Thursday, October 20, 2011 No Comments by Zelda

Renovations to the presidential homes and offices, as well as to the Bryntirion estate in Pretoria where ministers live, will cost more than R400m.

A brand-new dressing room and sauna are part of the interior renovations to Mahlamba Ndlopfu, the president’s official residence in Pretoria, of which the total estimated cost is about R169m.

These details are contained in a written reply by Public Works Minister Gwen Mahlanga-Nkabinde to parliamentary questions asked by Athol Trollip, the DA’s parliamentary leader.

Trollip has highlighted the huge expenses at a time when millions of people are unemployed and there is poor service delivery countrywide.

“The state can build 7 000 houses with these millions,” said Trollip.

He says President Jacob Zuma has a poor understanding of the hardships suffered by citizens and little respect for frugality.

“He will live in these houses and has to be accountable for the huge expenses.”

Details of the renovations are:
- Genadendal, Zuma’s official Cape Town residence: R13.5m has already been spent over the past three financial years
- Tuynhuys, Zuma’s offices at Parliament: R24.4m has been spent over the past three financial years and another R780 000 has been spent on office furniture
- Bryntirion estate in Pretoria: The estimated expense is R193m, of which R55m is for a new road to the estate, R42m for a new fence
- Mahlamba Ndlopfu, Zuma’s official residence in Pretoria: an estimated R169m. Maintenance has to be done to the security system, which includes improving escape routes and the installation of an electronic surveillance system

Apart from renovations to wooden frames, balconies, steps, fireplaces and chandeliers at this residence, a new dressing room, sauna and steam room are also being built.

New baths and toilets are being supplied and the house will be fitted with extensive energy saving devices, among them solar water heaters.

In response to Trollip’s question on whether the listed expenses were justified, Mahlangu-Nkabinde said the “market determined construction costs” and that the contracts were awarded after a tender procedure.

Presidency spokesperson Zanele Mngadi said none of the work had been ordered by Zuma.

“No, the president never gets involved in renovations,” The Star quoted her as saying.

“The department of public works is responsible for managing government property, and procurement is done in terms of its procurement policy.”

Credit to: Die Burger

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Now Salga wants to tax businesses

Tuesday, October 18, 2011 1 Comment by Zelda

South African businesses could be burdened with an additional local business tax if the SA Local Government Association has its way.

Making a presentation to parliament’s select committee on finance last month, Salga called for parliament to consider introducing a “local business tax”.

Should Salga succeed in persuading parliament to impose the tax, the association will raise an additional R19 billion, for service delivery improvements in big cities.

The tax, said the association, was needed to:

  • Generate more revenue for economic infrastructure and services;
  • Strengthen fiscal governance arrangements; and
  • Improve economic and general urban efficiency.

“Salga proposes that steps be taken to implement a local business tax to increase municipal responsiveness to the local economy, and local accountability generally, and to increase municipal fiscal capacity so that municipalities are better able to provide the infrastructure services required for economic growth,” said the association’s presentation.

Mayur Maganlal, the association’s executive director of economic development and planning, was quick to point out that the tax would be minimal.

“Our calculations indicate that it will be about a third of 1% of turnover, so if your turnover were R100, your tax will be 30c.

“There is a need for an overall increase in revenue for the cities because their current revenues are not sufficient to meet their service delivery challenges, backlogs and new responsibilities like public transport,” Maganlal said.

He said the local business tax is aimed at creating a basis for a service delivery platform to enable economic growth to cultivate a sustainable tax base.

Metros, he said, could not depend solely on grants and equitable shares from treasury because they were not predictable. The SA Revenue Service, he said, would be responsible for collecting the taxes and distributing them to cities.

Municipalities used to charge businesses a regional levy, but this was stopped in 2006.

Salga’s move comes at a time when the ANC is considering new and innovative ways to finance local government, especially rural municipalities.

Michael Begraim of the Cape Chamber of Commerce said: “To add another tax is not sustainable. To add an additional tax might be the final nail in the coffin; it will force some companies into closure.”

Andrew Layman, CE of the Durban Chamber of Commerce and Industry, echoed the same sentiments.

“We are opposed to the concept of a business tax. Metros get a share of the fuel levy emanating from their cities. It’s beyond questioning that municipalities need money for services and development. Extra money is required. We’re just not sure if it should come from businesses.”

Municipalities, he said, could raise about R19 billion every year if they saved about 3% of their expenditure.

Credit to: Times Live

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Taxpayers money falls through the cracks

Monday, October 17, 2011 No Comments by Zelda

The Auditor-General (AG) and National Treasury clearly keep records of municipal financial affairs, but decline to say how much wasted money is recovered from those responsible – that while municipal regulations enforce recovery.

It would seem that neglect to do so is shrugged off.

In its recent report on municipal finances from 2006/07 to 2012/13 Treasury clearly set out how city councils should handle unauthorised, irregular, fruitless and wasted expenditure.

Unauthorised spending may be permitted under certain circumstances. Irregular, fruitless and wasted costs may under no circumstances be sanctioned.

Unauthorised spending that is not subsequently sanctioned, as well as irregular, fruitless and wasted expenditure must be recovered from those responsible unless, after an investigation by a council committee, the council should declare it irrecoverable.

In practice this means the following: in the 2009/10 financial year, for instance, municipalities spent R5bn without authorisation. Only R1.1bn was authorised or written off.

A total of R4.14bn was irregularly spent, R77m of which was written off.

There was a total R189m fruitless and wasted expenditure, only R1m of which was written off.

Municipalities should therefore have recovered the balance – more than R8bn – from the responsible parties. This equals about a quarter of the cost of the Gautrain project.

Enquiry has revealed that Treasury has no record of this R8bn being recovered. The AG failed to respond to Sake24’s enquiry, and in its voluminous consolidated report on municipal audit results for 2009/10 there is no mention of recoveries.

Anita Botha, a municipal consultant at Pro-Active Management Services, said that in all the years that she had been involved with municipalities she had never heard of such money being recovered from a politician, even when there had been clear grounds for doing so. She was aware of isolated cases where a municipal official had had to cough up.

Botha reckoned there was no reason for Treasury’s inability to insist on reporting on recoveries from local authorities. She said it was the task of the municipal manager, as accounting officer, to set the recovery process in motion. “But he could not succeed without political support from the mayor.”

Botha says it is important for politicians to be accountable because voters are becoming increasingly aware of the reasons for the lack of service delivery.

“We are sitting on a powder keg,” she warns.

Advocate Paul Hoffman from the Institute for Accountability says squandered money is not recovered owing to the ANC’s policy of cadre deployment. Officials’ party loyalty ranks above their dedication to service delivery. He said civil organisations should compel the recovery of these amounts by reporting them to the Public Protector.

From questions addressed to the Public Protector, the Special Investigations Unit and the Asset Forfeiture Unit, it would appear that investigations into misapplication of funds take place at municipalities, but the organisations could not say whether the money recovered had gone to the municipality or to the fiscus.

Afriforum legal representative Willie Spies said if the guilty party was a municipal official, the matter should be handled in terms of labour legislation. If a party outside the council was involved, the council should lodge a civil claim in court. If a municipal manager had neglected to recover the money, it could be recovered from him personally.

Spies said communities or opposition parties could also approach the court for an order to force the municipal manager to do his job of recovering the money.

If the municipalities should recover the money, it need not be lost to service delivery.

Credit to: Sake24

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Taxpayers fleeced of R30bn

Thursday, October 13, 2011 No Comments by Zelda

South African taxpayers lose billions of rand every year to corruption, incompetence and negligence in the public service, Special Investigating Unit (SIU) boss Willie Hofmeyr has warned.

Briefing MPs on his unit’s annual report on Wednesday, Hofmeyr estimated that 20 percent – or between R25 billion and R30bn – of the government’s procurement budget alone went down the drain.

This was because officials stuck their fingers in the till, overpaid for products and services or failed to monitor how money was spent.

Hofmeyr said it was difficult to accurately determine the true scale of the problem, but the R30bn estimate – a figure accepted in Treasury circles – was “not unrealistic”.

He told visibly exasperated MPs these losses were incurred not only through corruption, but also by the failure of civil servants to properly monitor public spending. It was the poor who were suffering disproportionately because of this failed service delivery, he said.

The long-serving SIU boss suggested the country would have to increase the number of dedicated anti-corruption investigators tenfold – from about 700 to 7 000 – if the problem was to be tackled.

“(Our) laws, regulations and policies are pretty good. But if there are no consequences to them being broken, if there are not enough people to investigate an allegation that rules have been broken, and to hold somebody to account, then the culture of impunity spreads quickly,” he warned.

Over the past seven years, the SIU has vastly increased the number and scale of its investigations by having departments under investigation cover some of the costs.

A similar arrangement is used by the auditor-general.

However, an apparent oversight in the SIU Act seems to prohibit the investigating unit from applying this model.

Among government entities being probed is the Tshwane metro where about 65 municipal officials are being investigated for striking business deals worth about R185m with their own council.

Other irregularities in the city, including “collusion between officials and service providers” and the irregular approval of about R400m in spending, are also being looked into.

In all, the SIU is investigating 588 government procurement contracts valued at a staggering R9.1bn.

In 43 of these cases – which only cover the period April to June this year – the unit has confirmed “irregularities” of R1.4bn.

The unit is also probing 360 matters of conflict of interest, and has so far uncovered 45 incidents of conflict involving R99m.

MPs were also surprised to learn that Eskom – one of several government entities under investigation by the SIU – had obtained a legal opinion which effectively barred the SIU from receiving funding from a state entity, thereby losing one of its biggest sources of operating revenue.

Hofmeyr said he did not suspect an “ulterior motive” in the Eskom move, but the outcome nonetheless placed a question mark over the unit’s ability to continue with major investigations in the future.

He appealed to MPs to amend the SIU Act before the start of the next financial year – or to come forward with a different funding model.

In the meantime, the SIU has received Treasury approval to continue with the current funding arrangement in cases in which such agreements have already been entered into with state departments, but no new probes will be allowed using this arrangement.

The Treasury has also agreed to inject about R90m into the unit this year to help make up a potential shortfall.

“We did not want to communicate this publicly because we are obviously concerned about the impact on our staff, who may fear that this could lead to drastic job losses and so on.

“We only communicated this recently, after we had the assurance that we have a solution – at least for this year,” Hofmeyr said.

The SIU is not authorised to initiate its own investigations, but must await a presidential proclamation.

There are currently 22 active proclamations.

These have resulted in 60 ongoing investigations involving 18 government departments or state entities.

The biggest of these, the SIU’s “most consistently productive investigation”, began in 2005 and involves more than 40 000 public servants found to have been receiving social grants irregularly.

By clearing the system of these names, the SIU estimates it has saved the country R898m in future losses.

Another R244m will be paid back by implicated officials.

A total of 17 729 cases have been brought to court and 15 281 convictions have been obtained, according to the annual report.

Other government entities being probed include the SABC. Investigators have fingered 20 employees whose private business interests received R2.4bn in payments from the public broadcaster between September, 2007 and March last year. The auditor-general previously uncovered a similar scam involving another 20 SABC employees and about R30m.

The SIU has recommended the SABC institute disciplinary proceedings against 13 employees. A further five cases have been referred to the National Prosecuting Authority for criminal prosecution.

Credit to: Independent Online’s Political Bureau

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Councillors demand huge salary hikes

Friday, October 7, 2011 1 Comment by Zelda

Municipal councillors have asked parliament to increase their salaries and benefits to R815000 a year – the same as members of provincial legislatures.

The SA Local Government Association has also recommended that councillors be paid by the national Treasury, like all other politicians.

If the association has its way, the wage bill for South Africa’s 9000 councillors will cost taxpayers an extra R7 billion a year.

During a presentation to parliament’s select committee on finance last month, the association called for an “urgent” review of how councillors are remunerated to bring them into line with the pay packages of politicians in provincial and national government.

Excluding car allowances, full-time councillors earn an annual package of between R280000 and R542000, depending on the type of municipality they serve.

Their part-time counterparts earn between R119000 and R253000 a year, excluding car allowances.

Members of provincial legislatures also receive free cellphones, airtime, and laptops, which many of their local government counterparts do not.

The association also wants:

  • All part-time councillors to be made full-time councillors;
  • Councillors to be entitled to, at government expense, risk benefits including death cover, disability and funeral benefits, and insurance for personal assets lost or damaged due to public violence;
  • Pension fund benefits such as those enjoyed by provincial and national politicians; and
  • Salary increases and benefits to be finalised and implemented by April.

Lance Joel, the association’s chief operating officer, said: “In the main, what we are saying is that clearly there is a lack of appreciation of the role of councillors. According to legislation, councillors are politicians, like MECs, ministers, MPs and MPLs.

“It’s councillors that lose lives and have property damaged. There are endless stories of councillors being shot dead.

“They have no recourse when houses are burned and they are out in the cold. Councillors are public officials and they should be recognised as such – and be remunerated as such.”

In July, angry residents of Chiawelo, Soweto, torched two houses and two cars belonging to councillor Johannes Nemaungani and his predecessor, Mirriam Ramafola, in a dispute about pre-paid electricity meters.

Joel criticised the public for calling for the abolition of part-time councillors without making corresponding calls for “proper pay” for them.

“Why are you calling for part-time councillors to quit their jobs if they are not going to be remunerated as such?”

But local government expert Kevin Allan said there was no justification for councillors to be paid more – let alone from the national fiscus.

“The current dispensation for councillor payment is adequate. I think the comparison of local and provincial is [misplaced] – they do fundamentally different jobs,” he said.

Allan questioned the basis on which councillors wanted to be paid more.

“If the motivation is that we should free funds for development and services, I think that should be stated clearly.”

The DA’s local government spokesman, James Lorimer, said the association’s demands were unreasonable.

“It’s a non-starter. When the proposal was originally made, the central government said it was not affordable. It’s a fantasy; it’s not going to happen.”

He accused councillors of demanding “vastly improved salaries without vast improvements in services. Councillors don’t understand that funds are scarce and should be spent carefully.”

Deputy Cooperative Governance Minister Yunus Carrim said: “Salga might want to consider phasing in some of their demands over time, rather than  all at once.

“We will be meeting them soon.

Credit to: Times Live

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Shiceka claims trips benefited SA

Thursday, October 6, 2011 No Comments by Zelda

Embattled Co-operative Governance Minister Sicelo Shiceka has slammed Public Protector Thuli Madonsela, accusing her of treating him unfairly, subjecting him to “trial by ambush” and presuming him guilty before giving him an opportunity to prove his innocence.

Madonsela called on President Jacob Zuma to take steps against Shiceka after finding that he was guilty of splurging over R1 million of taxpayers’ money on personal trips and hotels.

She gave her report to Zuma, Shiceka and Finance M inister Pravin Gordhan two weeks ago.

She has since received their responses and plans to announce her final findings on Monday – seven days after Shiceka’s reply to her report was submitted.

Shiceka has been on sick leave since February.

The Times is in possession of Shiceka’s 10-page response to Madonsela. It was submitted by a departmental team appointed to assist him during his sick leave.

In the response, “Procedural fairness”, Shiceka accuses Madonsela of denying him the opportunity to seek legal representation or a chance to challenge the evidence she obtained from witnesses she interviewed.

“Therefore, it is submitted that the procedure adopted by the Public Protector is unlawful and unconstitutional as it deprived [Shiceka] of his constitutional right to a fair procedure.

“Accordingly, it is a peculiar step to issue a provisional finding of fact and expect the accused official to respond thereafter as that would be tantamount to trial by ambush or, worse, to being found guilty until one proves himself innocent,” the response read.

The Co-operative Governance ministry said that asking Shiceka to respond to the findings detailed in Madonsela’s provisional report was “a procedural cover-up for the glaring procedural irregularities”.

Last week, Madonsela slammed Business Day for publishing her provisional report in contravention of the Public Protector Act.

The newspaper reported that Madonsela called on Zuma to take remedial steps to recover over R1m from Shiceka after she found he had used state money to travel to Switzerland to visit his girlfriend in jail in December 2008; for accommodation at the One and Only Hotel in Cape Town in June 2009 with a man he called his “spiritual father”, and for taking accommodation at the same hotel after being allocated an official residence in Cape Town.

Madonsela said in her provisional finding that Shiceka misled the then acting president, Kgalema Motlanthe, and “travelled under false pretences to visit [his girlfriend] at the Anstalten Hindelbank Prison, in Berne, Switzerland, which he did on two occasions”.

Shiceka responded : “The Public Protector fails to prove that the minister’s visit was unofficial and deliberately ignores evidence that demonstrates that the minister’s visit to Switzerland did benefit the country during the hosting of the two soccer spectacular events.”

Ministry spokesman Botshelo Rakate confirmed that the response had been sent to the Public Protector.

Credit to: Times Live

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