Fired City of Johannesburg MMC for finance Rabelani Dagada has taken the fight to Mayor Herman Mashaba, and has challenged him to provide proof that he met with companies to collude on price-fixing.
Dagada has also challenged Mashaba to specify which companies he met with and how the purported meetings resulted in alterations of bids and tenders allegedly awarded to his business associates.
A source who previously worked in the City of Joburg, relying on information from insiders, this morning informed The Citizen the real reason Dagada was axed from his position was to circumvent the precarious financial position the City had found itself in.
It is alleged the soon-to-be tabled annual report and financial statements of the City of Joburg will show that since taking the reins from the previous ANC administration in August 2016, the DA-led administration has experienced diminished revenue collection.
“The inability to collect cash fast enough and exploit other sources of income while blaming the ANC for everything under the sun has unfortunately resulted in a situation where the City is technically insolvent. They have had to dip into the council’s reserve fund twice, withdrawing just over a billion rand to pay service providers and even salaries. When the pudding hits the fan, Mashaba will say I fired the inept MMC,” the source said.
Dagada himself is quoted by The Star as having said: “The reasons [for my removal] changed. For example, the reasons were that we were not collecting enough revenue.”
Another source, speaking on condition of anonymity, believes the cash crunch is so bad that, as the council is nearing the tabling of the financial statements, “Mashaba is avoiding doing the honourable thing [to resign] as he previously told the media”.
‘The mayor is a bully. He is a dictator, and wants yes men and women.’
Dagada dismissed Mashaba’s accusation that he influenced the tender processes for a company owned by his business associate, Seth Mukwevho, saying the amount was “very little, it’s not like millions of rands”.
The source said that was where the problem lay with Mashaba’s administration – companies were allegedly earmarked for work not tendered out openly under the disguise of cleaning up the ANC’s corruption.
“What Mashaba’s administration is effectively doing is bypassing the Municipal Finance Management Act, treasury regulations and the City’s supply-chain management policy by allocating work to service providers on the basis of conducting investigations against corrupt ANC deployees, but in the process, the scope of work is expanded to include other nonlegal work with open subcontracting. This is corruption dressed in anticorruption attire.
“What you find in the City is that a handful of companies are awarded work, primarily forensic investigation work, and although on face value they may be on approved database of legal service providers, it is their discretion to use whoever they want to subcontract to do substantive work which should strictly be taken out on open tender. As if that is not enough, they then fail to account to the public and ratepayers,” a source added.
When asked which company conducted the investigation against Dagada and the total expenditure related involved, director of mayoral communications Luyanda Mfeka responded: “A number of legal and disciplinary processes are now unfolding, which limits our ability to distribute report. Only once those processes have unfolded will we release that information as we always do.”
Mfeka further wrote: “The cost of the investigation into allegations made against the former MMC for finance, Rabelani Dagada, is R560 000,” and indicated that only in cases where companies agreed to their names being published would he be able to disclose the service provider.
‘Two women said they were forced to write affidavits, they must say how I forced them to sign tender documents.’
Mfeka, on the question of the status of the City’s finances, stated he was unable to give any further comment, as the financial statement of the City would be revealed when the council tabled the annual report at the end of January.
A furious Dagada said: “The mayor is a bully. He is a dictator, and wants yes men and women. I say that with huge humbleness. I did not influence anything. The report by Gobodo Forensic and Investigative Services, as per their recommendations, they say nothing should be done to Dr Dagaga and Dr Mukwevho.
“We [him and Mukwevho] registered a company in 2005, and by 2010, those companies were already in the stage of being deregistered. I didn’t declare on the form. Many companies were not going to pitch because the money was little. Mukwevho would have been appointed to the position. He had three relevant masters degrees and a PhD finance investment and with huge banking experience. Nobody will be able to charge me – the NPA will not agree.
“Two women said they were forced to write affidavits, they must say how I forced them to sign tender documents. This is rubbish. They [bids] go to the bid evaluation committee, where they deliberated with the bid adjudication committee.
“What are the names of those service providers of those companies I influenced? They don’t exist. My name will be cleared,” he added.