Lease report damning for Cele

A still unreleased report by Public Protector Thuli Madonsela, who reportedly faces arrest, condemns the conduct of the police chief and public works minister regarding the lease of new police headquarters in Durban. In the report originally obtained by Beeld, and of which Sapa has a copy, Madonsela finds that police chief General Bheki Cele's failure to ensure that the procurement process complied with legal requirements and prescripts resulted in the invalid conclusion of a lease agreement. This was to the detriment of the state and “constituted maladministration”. In her interim report, Madonsela found that Cele breached the Constitution and the Public Finance Management Act because a R1.17 billion deal to rent the building from businessman Roux Shabangu was not agreed in a fair, transparent and cost-effective manner. In the final document, Madonsela rejects Cele's argument that he was at the mercy of officials, some of whom had ignored his decision to withdraw all delegation of authority in respect of contracts exceeding R500 million.

“The view of the national commissioner that he was reliant upon the advice and decisions of senior supply chain management officials within the (SA Police Service) for his approval of the procurement of a lease amounting to R1.1 billion, cannot be accepted.” She also finds that there was no indication that the police had budgeted properly for leasing either the Transnet building in Durban or the new national headquarters in Pretoria from Shabangu. Madonsela found earlier this year that the R500 million lease Cele approved for the Pretoria offices was also unvalid. In the case of Durban, evidence suggested that police identified the building and entered into talks with Shabangu before assessing their office space needs, then tailored these to the “total lettable floor space available in the Transnet building”. Madonsela was also strongly critical of Public Works Gwen Mahlangu-Nkabinde's role in the conclusion of the Durban lease, finding that she failed to co-operate with the investigation. “The failure by the minister to respond to all questions put to her by the public protector and her apparent reluctance to co-operate fully with the investigation made it extremely difficult to obtain her version of the events ... and to evaluate that,” she said.

By contrast, evidence from other public works officials appeared consistent, she said. Madonsela cites testimony from the former director general of public works, Siviwe Dongwana, who said he finally approved the lease with Shabangu under duress after Mahlangu-Nkabinde replaced Geoff Doidge as minister in President Jacob Zuma's Cabinet reshuffle last year. “Mr Dongwana explained that he reluctantly agreed to the lease of the Transnet building only as a result of the pressures placed on him by the minister and Shabangu.” Mahlangu-Nkabinde ignored independent legal opinion that the lease was unvalid and claimed to be unaware that the department had suspended the tender process. “When he initially discussed the issue of the two leases with the minister, she told that him that she had done a bit of law in her studies and was satisfied that there was nothing wrong with the lease agreement,” according to the report. Dongwana testified that he feared for his safety and believed his phone calls were being intercepted as every time he spoke “about this matter, Shabangu would call me about the contents of the conversation, shortly thereafter”.

He told Madonsela that it seemed Shabangu “had a favourable ear with the minister” and that he communicated directly with her. The businessman apparently referred to the minister as his “elder sister”. Mahlangu-Nkabinde conceded during the public protector's investigation that she had telephonic contact with Shabangu and met with him on several occasions. The Cape Times reported on Wednesday that police were planning to arrest Madonsela on fraud and corruption charges. Madonsela, who was expected to release her final report on the two lease contracts with Shabangu soon, denied any wrongdoing.