Lesufi to call in forensic firm to scrutinise R34 million office rentals

Gauteng Premier Panyaza Lesufi will be looking into the high costs associated with renting office space for government departments.

MEC for Infrastructure Development Jacob Mamabolo recently revealed that R34 million per month was being spent on renting office space, despite the provincial government owning 41 vacant buildings.

Additionally, Mamabolo’s breakdown of office space expenditure showed that over R2 billion had been spent on offices for provincial departments in the last five financial years

Vacant buildings unsuitable

Lesufi is said to have held an urgent meeting over the weekend with Mamabolo and the department’s accounting officer to discuss the contracts.

Among the rentals, the premier’s office located in Marshall Street costs R4 million a month, while three offices in Loveday, Fox and Sauer Streets used by the Department of Education cost a combined R10.6 million per month.

Offices shared by the Departments of Agriculture and Economic Development in Eloff Street cost a combined R7 million per month.

Mamabolo’s earlier explanation on the vacant buildings was that they were unsuitable for occupancy as they did not meet safety requirements.

The 41 vacant government-owned buildings are located in Johannesburg and Pretoria CBDs.

CBD rehabilitation project

Lesufi on Monday outlined the steps he would take in order to examine the contracts and find ways to streamline the provincial government’s use of its properties.

“[We will] appoint an independent forensic firm to assess whether the leasing arrangement provides value for money and investigate potential wrongdoing in all the contracts,” stated the premier.

He added that there be an independent review of the “entire value chain”, which will include a cost-benefit analysis to consider the possibility of selling the vacant properties.

Mamabolo had earlier stated the vacant buildings in Johannesburg would be incorporated into the administration’s rehabilitation projects.

Lesufi reiterated the intentions of the CBD revitalisation programme, stating the desire to create mixed-use developments, affordable housing and shared community spaces.

“This long-term plan will optimise state-owned properties, reduce reliance on leased spaces and ensure cost effective, modernised infrastructure for improved public service delivery,” Lesufi stated.

“We want to ensure strict compliance with the Public Finance Management Act and supply chain regulations, while decisively scrutinising all expenditures on leased properties.

“The process will guarantee due diligence, transparency and accountability,” the premier concluded.

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