Emfuleni municipal official wastes more than R120 million municipal funds but remain in job

A top Gauteng municipal boss – responsible for tenders involving millions at the financially embattled Emfuleni Local Municipality – is in hot water for allegedly using the funeral of a ward councillor to enrich himself.

The official in question allegedly also forced the council to pay a company R700 000 a month – over a period of three years – to print documents for council meetings and municipal accounts. Jason Mthwane, manager supply chain management, allegedly manipulated council’s tender procedures when he organised a “special civic funeral’ for ward councillor Vusi Mnune in April this year.

Mnune died on March 28, a few days after President Cyril Ramaphosa declared a lockdown due to Covid-19. Mthwane allegedly failed to obtain three quotations for the budgeted amount of R30 000 for the funeral. Council allegedly paid more than it budgeted for, especially after the country was under lockdown and restrictions on funeral arrangements were in place.

It is also alleged Mthwane appointed a service provider of his choice for the funeral, in contravention of municipal policies These allegations are contained in a letter, seen by Independent Media, and written by Emfuleni’s chief financial officer Andile Dyakala to municipal manager Lucky Leseane. Dyakala wants Leseane to conduct a forensic investigation into all allegations against Mthwane.

“It is extremely unfortunate and despicable that a funeral is used for enrichment through the manipulation and abuse of SCM regulations and policies,” Dyakala wrote. He asked the municipality to blacklist the company which received the tender on the database of the National Treasury and declare payments made to it “irregular”. The R700 000 paid to print documents for council meetings and accounts for residents allegedly cost Emfuleni R8.4 million annually and R25.2 million for a period of 36 months.

“In September 2019, Mr Andile Dyakala insisted that this service must go out on a competitive bidding process in order to get value for money. This process was resisted by the manager SCM, and he further deliberately frustrated the evaluation of the tender. In January 2020 a new service provider was appointed at an amount of R102 000 per month, saving the municipality about R600 000 and cumulatively saving R21.6m,” Dyakala said. He added: “In line with Section 32 of the Municipal Finance Management Act it must be established whether the irregular expenditure can be recovered.”

In another damning allegation, Dyakala said Mthwane reappointed insurance brokers in June 2016 for another three years at a monthly premium of R5.2 million per month. A council audit report in May last year declared the appointment "irregular". According to Dyakala, the insurance brokers were appointed for an amount of R85 million over three years, but the municipality paid R190 million for the duration of the appointment – R100 million above the original appointment value.

Dyakala alleges Mthwane manipulated tender procedures to acquire Covid-19 personal protective equipment (PPE) from suppliers allegedly not on the municipal database. Contacted for comment, Mthwane did not confirm or deny allegations. He said: “The municipal manager and communications manager are better positioned to respond as they are aware of internal processes.” Leseane refused to answer, saying it was an “internal matter”.

Dyakala gave a similar response: “This was an internal memorandum to the accounting officer unfortunately leaked to the public. However, I can confirm that I did write to the municipal manager. No decision has been made on the seriousness of the allegations despite the municipality facing a financial crisis and being under administration due to rampant acts of fraud and corruption."