NEWS

Zuma Buddy's Tender Scandal

A friend of the president received a huge advance payment on a contract in violation of Treasury rules.

22/05/2017 10:00 SAST | Updated 22/05/2017 10:00 SAST
Mike Hutchings / Reuters
Former South African deputy-President Jacob Zuma smiles at supporters after his acquittal on rape charges, in the Johannesburg High Court May 8, 2006. A South African judge on Monday acquitted Zuma of raping an HIV-positive family friend, ending a case that opened deep rifts in the ruling African National Congress.

A close associate of President Jacob Zuma has been implicated in a tender scandal involving the advance payment of millions before a contract was even signed.

The scandal is the latest in a series of stories published by City Press which the publication is calling WaterGate. The series looks at corruption in bulk water delivery projects and how water minister Nomvula Mokonyane has been running her department.

In this case, 49-year-old Philani Mavundla was part of a joint venture awarded a R1 billion contract to construct an acid mine drainage plant in Springs.

But City Press reported that the joint venture company was paid an advance of R81 million before construction began –- something that is forbidden by the Public Finance Management Act.

Mavundla is the former mayor of Greyton in KwaZulu-Natal and offered to pay Zuma's portion of the security upgrades to his home in Nkandla when he was ordered to do so by former public protector Thuli Madonsela.

He is reportedly a construction magnate with 15 companies, who helped establish the Friends of Jacob Zuma Trust in 2005 after the president was charged with fraud and corruption.

City Press also reported that he slaughtered 20 cattle after Zuma won the ANC presidency at Polokwane in 2007.

The tender was awarded by the Trans Caledon Tunnel Authority (TCTA), which falls under the department of water and sanitation.

A spokeswoman for the TCTA Wanda Mkutshulwa told City Press that it was all above board.

But a senior Treasury official interviewed by City Press said: "There was no place and space for advance payments in the PFMA... The normal way is that you supply the goods and the services, then we pay – not the other way round. The bidding process is meant to eliminate those who do not have resources and those who do not have the capacity to do the job.

"If you can give a tender to anyone and then assist them to do the job, what is the point of procurement policies? Advancing payments means you can give a tender to anyone, without regard to whether they have the resources or capacity to deliver."