The Special Investigating Unit (SIU) is set to recoup over R400 million on behalf of Umgeni Water following fraudulent tendering processes.
Ramaphosa had tasked the SIU to look into the affairs of Umgeni Water, the second largest water board in the country. This, after allegations of corruption as well as fruitless and wasteful expenditure surfaced.
The national parliament heard on Wednesday that the SIU has briefed its Civil Litigation Unit on five unspecified contracts valued at R465 million, with the aim of instituting civil proceedings in the Special Tribunal to declare the contracts invalid. The investigation into the water utility was initiated by President Cyril Ramaphosa in 2019.
The SIU said the president’s report was at an advanced stage of being presented.
Eighteen disciplinary referrals to Umgeni Water have been made, while 45 administrative action referrals were made to place the entities and individuals involved on Umgeni Water’s Vendor List of Defaulters as well as National Treasury’s Database of Restricted Suppliers.
SIU spokesperson Advocate Andy Mothibi told parliament’s water and sanitation portfolio that the SIU has appointed a quantity surveyor to assist in the quantification of the actual losses to Umgeni Water with a view to institute civil action to recover the lost money.
According to Mothibi’s report, the SIU was roped into the tender saga in 2019 to investigate seven projects.
• the upgrade of emergency boreholes in the Umkhanyakude District to the value of R51 million
• the repair or refurbishment of the Nagle Aqauduct — R57 million
• the replacement of filter slabs, pipelines including nozzles — R65 million
• the provision of chlorine and distribution equipment at the Durban Heights Plant. The project was later extended to include the upgrading of shaft pumps and lifts — R130 million
• the provision of emergency pipelines in the Ugu District Municipality — R27 million
• purchasing and installation of control valves — R55 million
• installation of pipelines in the Nungwane area, Amanzimtoti — R80 million.
Mothibi said a quantity surveyor has completed the work and is drafting his final report.
SIU preparing final report
The focus areas were to investigate the procurement of, or contracting, including subcontracting, for goods, works or services by or on behalf of Umgeni and payments made in respect of the projects. The SIU is in the final reporting phase.
All the matters referred to the NPA have been actioned and dockets have been opened.
The criminal matters are with Head Office DPCI in the Serious Corruption Offences component and the SIU is providing ongoing support in respect of these matters.
Team of attorneys and advocates briefed
Umgeni Water has briefed a team of attorneys and advocates to deal with the disciplinary matters and administrative action referrals. The SIU is currently consulting with them,” said Mothibi in the report.
He said a final report for the president has been drafted and was in the final review process at the SIU offices.
“The project (investigation) end date was 31 May 2022. The investigation is complete and the project will be extended to 30 November 2022 for the support phase and to institute civil proceedings in the Special Tribunal.
“The SIU is motivating for an extension to the proclamation as more allegations have been uncovered during the course of the investigation.
He said, “Other focuses are to look into any unlawful or improper conduct by board members, officials or Umgeni employees. Contractors, suppliers or any other person or entity involved in the projects are also focused upon.”
Shami Harichunder, corporate stakeholder manager at Umgeni Water said the water board is aware of the tabling of report in Parliament.
“Umgeni Water is co-operating fully with the SIU and is consulting with a legal team. At the appropriate time Umgeni Water will issue a statement, in consultation with the SIU, on what actions that are to be taken arising from findings or recommendations in the report” Harichunder said in a statement on Wednesday night.