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Aug 23, 2012

Flawed leases could cost govt billions

Johannesburg|Nissan|Service|Desmond Simamane|Roux Shabangu|Siviwe Dongwana|Thabo Moagi|Thulas Nxesi|GTI

Financial losses due to fraud and corruption regarding leases could run into billions of rand, Public Works Minister Thulas Nxesi said on Wednesday.

At a media briefing at Parliament, he said 3 000 leases were being scrutinised, 500 of which had been audited so far.

"Our intention is to try and recover what was lost," said Nxesi.

In addition, the department was paying dearly for advocates to help with legal proceedings against officials accused of graft.

Nine officials had been charged, while another six were soon to face the music.

"To corrupt individuals, I want to leave you with the following thought: You can run, but you can't hide. If you steal from the poor we are coming to get you," Nxesi said.

Cases under investigation included the controversial R1.7-billion police lease scandal with businessman Roux Shabangu.

The department had asked the high court to declare the lease agreement invalid.

"The state attorneys are handling this matter on behalf of the department. We are awaiting a date from the registrar of the court to set the matter down for hearing," Nxesi said.

Another matter involved the probe into former public works director general Siviwe Dongwana, which concluded that the reasons for his suspension were frivolous.

However, he would not be returning to his position.

After consultation with the minister of public service and administration, Dongwana's employment contract had been re-determined to be terminated on August 15 this year with a settlement payment, instead of July 2015.

Last year, it was reported Dongwana was the highest paid director general in government, earning around R1.5-million a year.

Among others, the disciplinary hearing of one of two officials from the department's Johannesburg region, charged with misconduct, had been completed.

"The officials (Thabo Moagi and Desmond Simamane) received payments for motor vehicles as corrupt payments from the landlord.

"In the case of Mr Moagi R285,000 for a Golf 5 GTI; in the case of Mr Simamane a Nissan double cab to the value of R566,250 and various payments to the value of R635,000," said Nxesi.

The two were acting as both portfolio managers and members of bid specification and evaluation committees.

"Many of these bids were not advertised. They negotiated with the said landlord owning 10 companies and awarded 28 leases of which four [properties] were never occupied despite payments being made for three years in respect of these leases," Nxesi said.

The outcome of Moagi's disciplinary hearing was expected soon. Simamane resigned before his hearing started.

Police were also carrying out criminal investigations into fraud and corruption against Moagi, Simamane, and the landlord, he said.

Edited by: Sapa
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