State resources allegedly used to fight internal battles
Durban – Department of Mineral Resources and Energy Minister Gwede Mantashe is allegedly hatching a plan to finish off the embattled suspended ANC secretary-general, Ace Magashule.
This is contained in an explosive letter written to President Cyril Ramaphosa on Wednesday by a whistle-blower complaining to him about the use of state resources by the minister and his official to fight party internal battles.
In the letter seen by the Daily News on Thursday, the source, who called himself a whistle-blower, was alerting the president about the imminent wasteful expenditure by the department where Mantashe appointed a forensic firm, SizweNtsalubaGobodo (SNG) Grant Thornton, to initiate a forensic investigation into R171 million tenders that were awarded to Central Lake Trading in 2016, despite the department having a report done by Vernitos Consulting cc, which found no wrongdoing.
According to the whistle-blower, known to the Daily News, the intention is to implicate Magashule whom the report will find failed to prevent corruption while still the premier of Free State.
In the letter and other supporting documents, the source said the Department of Energy (DoE), as it was known at that time, wanted the services of the IT company to install a Programme Management System, which was part of the requirements to ensure high-level security of information for the Nuclear New Build Programme.
The nuclear build was to result in the building of two nuclear energy plants, which the Energy Department would oversee as co-ordinator. Instead of issuing a tender, the DoE realised that the Free State Provincial Treasury was already working with an IT firm doing similar work. It then requested the same company to do the job for it.
The DoE’s tender was found by the auditor-general (AG) to be irregular, which the DoE didn’t agree with. It then appointed Vernitos Consulting cc to review the AG’s report, which it did. The company finished its work on May 29, 2019, and found no wrongdoing and the DoE, under Mantashe, accepted its report.
The source further said recently Mantashe, his adviser, advocate Sandile Nogxina and chief financial officer Yvonne Chetty, who had been reinstated at the instruction of Mantashe after she was suspended for making irregular payments of R56m to a company called Mahloko A Phahla, held a private meeting. The source said after that meeting, Chetty informed the source that the minister wanted ammunition against Magashule similar to the Free State asbestos project in which he was charged with lack of oversight.
“She informed me that the minister instructed her to find dirt on the award of the procurement management system that was done using Treasury regulation section 16A6.6 which originated in the Free State involving Central Lake Trading. She advised me it was the intention of the minister to use the SNG Grant Thornton report to set aside the DMRE (Department of Mineral Resources and Energy) process of procurement as irregular,” says the source in the letter. The source says SNG Grant Thornton was eventually appointed.
The source claims the appointment itself was irregularly made because the company that should have got the tender was Rakoma and Associates which charged R176 an hour while SNG Grant Thornton charged R272 an hour. These two companies and two others were invited to bid. The source further said Chetty was disappointed that SNG Grant Thornton charged higher than Rakoma, but said it must be overlooked because she would consult Nogxina.
“Following that consultation, Ms Chetty informed me that SNG Grant Thornton must be appointed despite the price being higher. She smiled and said Grant Thornton are manageable and that she and advocate Nogxina will ensure a predetermined outcome will be achieved as she had also spoken to a friend at SNG Grant Thornton. She mentioned it will be similar to the KPMG report on the Sars Rogue Unit where the outcome was predetermined,” reads the source’s letter.
She stated that Chetty advised that the Vernitos Consulting report must be kept under wraps and SNG Grant Thornton must not have sight of it.
“I totally despise that the DMRE via Ms Chetty is being used to fight political battles on instruction from the minister and his adviser advocate Nogxina. The government is bleeding financially and yet we incur fruitless and wasteful expenditure to fight political battles.
“I pray that information assists to stop the Rot and Corruption in our country. From Whistle Blower for Clean Governance,” the whistle-blower signs off in the letter.
Nogxina said, as an adviser, he did not get involved in operational matters. He said he did not even know the company and could not initiate any investigation against anyone as an adviser so he didn’t know how he could implicate Magashule.
“I have not met Chetty,” said Nogxina.
Mantashe confirmed that his department has initiated the new investigation because Central Lake Trading did not do its job properly because the system is not working, even today. He said the R171m had to be investigated because it was wasted since the system installed by Central Lake Trading was not working.
He said he didn’t know how Magashule was being brought into the whole thing because the department initiated the probe way before Magashule was arrested, but the tender document awarding SNG Grant Thornton, which the Daily News has seen, was signed on April 23, 2021 by both Chetty and Alex Philippou, who is secretary of SNG Grant Thornton advisory services.
Chetty said she would respond via email, but at the time of publishing she had not responded.
In an automatic reply, the SNG chief executive said he was in a meeting and has not responded to the publication.