Ace Magashule


Municipality spent R2bn on dodgy deals

Monday, June 13, 2011 No Comments by Zelda

One of the country’s worst-run municipalities went on a R2bn spending spree, which has been exposed in a series of explosive reports.

Free State premier Ace Magashule knew about suspicious dealings at the Matjhabeng municipality as far back as 2009 – but no action has been taken against any of the implicated officials.

The municipality, which incorporates Welkom, Odendaalsrus, Virginia, Henneman, Allenridge and Ventersburg, spent R1.6bn of its R1.7bn budget on “unaccounted expenditure” and property, according to the latest auditor-general’s report.

In addition, the municipality, according to the AG, wrote off bad debts totalling R1bn in the past four years. The R1.6bn includes R876.3m on property, R258.5m through unaccounted expenditure, R227.8m in debts incorrectly written off and R230.3m on “unauthorised, fruitless and wasteful expenditure”.

Several reports by a forensic company, as well as a commission of inquiry headed by the then co-operative governance MEC Mosebenzi Zwane, show how Matjhabeng – which, according to its website has a population of “more than 500000″ – got itself into such a mess.

They show that, on one occasion, officials tried to destroy documents stashed in wheelie bins, while investigations were under way. Some of the reports are over a year old.

Magashule this week admitted that there were “problems” at Matjhabeng that were reported to him as far back as 2009. However, he said he was never made aware of the full extent. “I didn’t know about these details and these billions.”

One of the men implicated in ripping off public funds is Jaqui Gao. Magashule said he had stopped Gao’s company, Rui Star, from doing business in Matjhabeng because of suspected corruption involving Matjhabeng’s former municipal manager, the late Thabo Pietersen.

The company had up to that point received at least R20m in tenders. “We picked up about Rui Star supplying substandard bricks and supplying (bricks) for Pietersen’s house (in Bloemfontein),” he said.

The reports also detail that:
•    R200000 was paid into the account of ex-mayor Mathabo Leeto’s husband, Lehana, by photocopy company Gestetner after it was awarded an “irregular” R15m tender;
•    R1.5m was approved for renovations to the mayoral house, deemed to be “personal enrichment”; and
•    Former municipal manager Dr Ben Malakoane signed questionable tenders worth R80m – 10 of them in one day, shortly before he resigned to join a company that benefited.

The Zwane report found Malakoane “grossly negligent” and “undermining the rule of law” for signing contracts “without following due process”. The report recommended a “dedicated forensic investigation” into his role in the sale of council land to Pinnacle Point for a R500m shopping mall.

Magashule admitted he was close to Pietersen and Malakoane saying: “They are my comrades.”

Leeto is mayor of the Lejweleputswa district municipality in northwest Free State and has widely been tipped to be promoted by Magashule to an MEC.

Asked if she’d repay the costs of her home renovations, Leeto said “there was neither determination made nor any finding that there was an irregularity on my part”.

Her husband Lehana confirmed that the R200000 was indeed deposited into his bank account but couldn’t explain how. He was unable to prove, as he claimed, that the money had been returned.

Said Magashule: “I think it’s completely unfair if you want to blame me for all of this. I can’t protect anyone. I’m not that powerful.”

Matjhabeng spokesman Modise Mahlatsane said the council was still waiting for the final report from investigating firm Ramathe Fivaz and had never seen Zwane’s report.

Mahlatsane said the council was implementing an “action plan” to deal with the auditor-general’s “queries and recommendations”.

Gao denied any wrongdoing. “People are jealous. I know Pietersen because I used to go to his office to demand (outstanding payments).”

Credit to: Times Live

  • Email
Tagged , , , , , , , , , ,

Free State: Province of ‘no hope’

Monday, March 7, 2011 No Comments by Zelda

Two months before the local government elections, Free State Premier and African Nation Congress (ANC) chairman Ace Magashule has admitted that local municipalities in the province are in such a poor state that communities have lost hope.

Free State Premier and African Nation Congress (ANC) chairman Ace Magashule. Photo: Sunday Times

Delivering his state of the province address in Bloemfontein on Friday, Magashule painted a picture of municipalities incapable of delivering even the most basic services and whose operation depend on handouts from the provincial government.

“In Xhariep district municipality there is no hope and there is no life,” he told reporters.

This admission is the ANC’s attempt to convince communities in the province frustrated with the slow pace or lack of service delivery not to abandon the party in the May 18 local government election.

While the ANC received an above-average vote in the 2009 national election — 71,9% compared with a national 65,9% — and the Democratic Alliance (DA) holds no municipality in the province, it is at risk of receiving a weaker mandate, which would loosen its grip.

“I don’t see ANC voters voting for the DA. If some of their voters decide to stay away, the party will win wards by fewer votes,” political analyst Steven Friedman said yesterday.

Part of the problem provincial ANC authorities face — and not just in the Free State — is the inevitable jostling between members as positions on regional structures disappear due to the demarcation of new boundaries.

Magashule criticised the national government’s Demarcation Board for incorporating the Naledi local municipality into Xhariep district municipality, saying it did not make economic sense.

“The answer does not lie in the demarcation process that results, for an example, in incorporating a primarily poverty-stricken locality such as Naledi into an even poorer Xhariep district.” Many municipalities were not financially viable because residents were too poor to pay for services. As a result, many municipalities owed Eskom millions of rands for electricity, he said.

The Nqwathe municipality owed Eskom R24m and Mafube municipality R24m. “When they are supposed to pay Eskom R10 they charge their customers R6. Therefore they are not making any profit,” he said.

Of the 91% of Free State residents who have access to electricity, more than 60% receive free electricity as they are considered indigent.

“Given the fact that few municipalities have a sustainable and sufficient tax base, it is not surprising that the local government sector faces particular challenges with the payment of Eskom accounts,” said Magashule.

Early this year he told Business Day that the province was paying salaries for some of the municipalities’ employees.

On Friday, he committed his government to continuing supporting poor municipalities until solutions are found. “We should, actually, give further consideration to a model that will create viable municipal governments throughout the province.”

He said although municipalities had minimal resources, they should be able to get the basics right.

“Consistent maintenance of existing infrastructure must be supported by adequate and appropriate budget allocations, and comprehensive planning must be done for infrastructure development.”

Credit to: Business Day

  • Email
Tagged , , ,

Bloem and E.London only metros after 2011 elections

Friday, December 10, 2010 No Comments by Zelda

The Municipal Demarcation Board yesterday defended its decision to recommend to the Independent Electoral Commission (IEC) that Mangaung (Bloemfontein) become a metropolitan area, following an attack by Free State Premier Ace Magashule.

Magashule criticised the board three months after the deadline for submitting municipal borders to the IEC. He raised concerns at the recent African National Congress (ANC) summit on local government about the political power and influence metro leaders enjoy.

Addressing a media briefing yesterday, the board’s chairman Landiwe Mahlangu said they were “taken aback” by his criticism.

“The board had numerous engagements with the provinces, including the Free State, as part of the ward delimitation process,” Mahlangu said.

“At no stage of our engagement with stakeholders, including the Mangaung Municipality’s events as part of its preparations to assume the metro status — at which the premier was present — did he show any hint that he harboured such strong views about the role and function of the board.”

Mahlangu said the board had not been officially approached to explore the possibility of reducing any number of municipalities.

As a result, next year’s local government elections would be based on the existing 284 municipalities.

The board recommended changes to 4277 wards in SA.

Mahlangu urged voters to check in which ward they had to vote. Some wards have been reduced or expanded to accommodate the movement of voters since the previous local government election.

“We have tried to keep the wards unchanged in most areas. However, the laws of this country demand that we make an assessment every five years and ensure that there is a balance between the ratios of voters and the number of councillors in a municipality,” Mahlangu said.

Briefing reporters Thursday in Pretoria, Mahlangu said Buffalo City in East London will also be re-categorized as a metropolitan.

“After carefully considering the economic activity and integrated development planning, we came to a conclusion that Buffalo City and Mangaung should become metropolitan municipalities with effect after next year’s local government elections,” he said.

Metropolitan municipalities execute all the functions of local government for a city or conurbation. This is in contrast to areas which are primarily rural, where the local government is divided into district municipalities and local municipalities.

Mangaung and Buffalo City will increase the number of metropolitan municipalities from six to eight. The current metros are City of Johannesburg, Tshwane, Ekurhuleni, Cape Town, eThekwini and Nelson Mandela Bay.

Mahlangu said that while there is a talk of doing away with economically weak municipalities, the 2011 local government elections will be based on the existing 4 277 wards.

“Next year’s elections will be based on the existent boundaries and that can’t be changed,” he said.

In September this year, Mahlangu presented the Independent Electoral Commission with the final list of ward boundaries.

Credit to: Business Day and BuaNews

  • Email
Tagged , , , , ,

Keep provinces, says many ANC leaders

Monday, December 6, 2010 No Comments by Zelda

Influential African National Congress (ANC) leaders argued against the scrapping of provincial governments, leading a debate at the party’s summit about provincial and local government over the weekend.

The Business Day reports that the proposal to abolish provinces is one of four options under review: keeping all of the nine provinces; abolishing them; reducing their number; or creating scaled-down regional centres.

Scrapping provinces is an unpopular option, as these structures are a job- creation and patronage tool for political parties.

KwaZulu-Natal ANC chairman Premier Zweli Mkhize and Free State party chairman Premier Ace Magashule told delegates at the Midrand summit that scrapping the provincial layer would not resolve the problems facing them.

Both suggested a review of their operations, and a possible reduction in the number of provinces.

ANC members and leaders calling for the scrapping of provinces complain that this sphere of government is a waste of state resources as it duplicates work already done elsewhere in government.

Dr Mkhize said there were problems with the three spheres of government that needed to be addressed, such as the misalignment of priorities at national and provincial governments.

He said provinces had to align their targets with the government at national level, and provinces should implement the priorities of the national government, in line with the ANC’s approach as a unitary party.

“We (should say) when we have agreed on outcomes and targets, no changes must be made. This for me is the area that I believe we must deal with,” Dr Mkhize said.

He argued that provinces were crucial in co-ordinating government programmes and even if they were abolished, money would still be spent on administrative work to perform those tasks.

“It will be a serious challenge to take away that layer of co-ordination,” said Dr Mkhize.

Magashule said if the ANC abolished the provinces, it would create problems.

“My view is, you can’t do away with provinces, if you want to do something, you may want to reduce the number of provinces.”

He called on the national government to step up its role of supporting the lower spheres. Gauteng speaker Lindiwe Maseko was clear in her view: “We need provinces.”

She suggested the party investigate their failure and find ways to improve them.

The provinces were created during the multiparty negotiations in the early 1990s, when minority parties pushed the ANC into a compromise on the unitary state that the ANC was promoting.

Credit to: Business Day

  • Email
Tagged , , ,