FS spent millions, with no houses, no arrests to show for it

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Judge RM M Zondo one of the four Judges interviewed for the Constitutional Court vacancy during the interview at the Southern Sun hotel. Picture: SIMPHIWE NKWALI /09/06/2012
The chairperson of the Commission of Inquiry into State Capture, Deputy Chief Justice Raymond Zondo, has said it was highly concerning that 10 years after the R1billion Free State housing project saw millions being lost, no persons have been charged.

Zondo heard on Tuesday that the Free State Department of Human Settlements paid R631 million in a housing project worth billions without receiving any value for money.

The chairperson was on Tuesday hearing testimony from the head of the Free State Department of Human Settlements Nthimotse Mokhesi on the R1-billion project.

Mokhesi told Zondo that the department paid the money without receiving any value for it and that the Special Investigations Unit (SIU) has recovered some of it.

Zondo heard that despite the money that was misspent for the project, hundreds of beneficiaries of the project remained homeless.

In his affidavit to the commission, Mokhesi said the department had instituted action against the contractors and material suppliers to recover the money lost from the project.

He added that “to the best” of his knowledge, action had been taken against all the contractors and suppliers.

Evidence leader at the commission, Advocate Paul Pretorius, however, said there was an indication by the commission’s investigators that action had not been taken against all the contractors and suppliers and that further investigations into this were necessary.

Pretorius asked Mokhesi whether the provincial department was aware that many of the contractors and suppliers have gone into liquidation, while some have been sequestrated.

“Yes, there are instances like that,” said Mokhesi.

Zondo asked Mokhesi if he could give a percentage of the contractors and suppliers that the department could recover money from.

He said that according to his observation, “we might not recover much”, adding that there had been a recent court application that would continue and that the legal unit in the department could provide a more recent update.

Zondo heard that some contractors who worked on the project had been disqualified, some had never built houses but were awarded contracts to build about 600 RDP houses, among other issues.

He asked Mokhesi whether any officials in the department or politicians who may have facilitated the failure of the project had been sued for money to be recovered from them, to which Mokhesi said no.

Zondo heard that in some instances material was purportedly delivered without any proof, while in other instances material was dumped on-site without anyone to receive it.

A number of regulations, including the provisions of treasury regulations and the provincial department’s supply chain management policy, were breached in the implementation of the project, Zondo heard.

Zondo said it was concerning that since the implementation of the project, which was in 2010 and 2011, though millions were lost, no persons have been charged or arrested.

The Citizen