Mosebenzi Zwane dismisses and deflects on failed R631m Free State housing project

Mosebenzi Zwane has continued to deny wrongdoing regarding Free State housing contracts while he was human settlements MEC when he appeared at the State Capture inquiry on Friday.

Zwane is implicated in the provincial department's 2010 decision to prepay service providers for housing projects without going to tender. The inquiry has heard that at least R631-million was spent on prepayments with nothing to show for it.

The former MEC denied he threatened to fire officials who didn't support the project. He allegedly told his then head of department (HOD) Mpho Mokoena, who said he raised questions about the deals, to resign and that he would end up poor if he didn't approve the project.

“There was no such a comment from me,” said Zwane.

He claimed there was proof he wasn't a “monster” towards his HOD as he did not take action against Mokoena when he took leave in December 2010 despite Zwane's instruction for officials to work through the festive season.

“I deny that is the truth and the sole truth, chair, because if he was so scared of me he would have listened to me even when I said he should not go on holiday. It's on record that he did go on holiday,” said Zwane.

He also denied he presented officials with the list of 106 favoured service providers and then instructed the department to fast-track payments to selected companies, some of which have been linked to then-premier Ace Magashule.

Employees at the Free State department of human settlements at the time have testified that Zwane hatched the plan to illegally pay suppliers in October and November 2010, but Zwane continued to distance himself from the project and blame his juniors.

“I had not committed any wrongdoing knowingly. I have not rejected any proposal as the MEC by then that was brought to me by my team,” he said.

“From where I am seated, I have done everything in my power to ensure that any wrongdoing should be eliminated and there is proof to that effect. I wouldn't have participated in any way to any wrongdoing knowingly.”

Inquiry chairperson Deputy Chief Justice Raymond Zondo questioned Zwane on his understanding of the law.

Zwane, who went on to become national mineral resources minister and has been implicated in alleged corruption related to the Estina Dairy project and Tegeta's acquisition of Optimum Coal, claimed department officials told him it was legal to give business to suppliers on the department's database, ignoring standard public procurement processes.

Zondo asked for clarity on Zwane's discussions with department officials: “After talking to them about this database or list phenomenon, your understanding was that once companies or entities had been included in the database, or in the list: one, that would be for five years; and, two, there would be no open tender process for each project that might come up within the five years?”

Zwane said that's what he believed, that his department could pay millions to suppliers simply because they were on a list.

Procurement regulations do make provision for emergency procurement and signing contracts without going tender below a certain value, but the department's programme was in blatant violation of the law.

Zwane was also questioned about a meeting he is said to have attended in February 2011 where then human settlements minister Tokyo Sexwale told him to stop the illegal prepayments to suppliers.

He said he could not remember that meeting and in the same month was moved to another position within the Free State government. The unlawful payments continued after that meeting.

“In hindsight, one must admit that the administration of the whole process had loopholes in terms of risk mitigation internal controls and things like that,” Zwane told the inquiry on Friday.

“For all intents and purposes, we tried our level best to build houses and to a certain extent we succeeded,” he claimed despite the widespread failures during his term as MEC.

Archive Photo: Matshela Koko at the parliamentary inquiry into alleged corruption at Eskom on January 24, 2018 in Cape Town. (Photo by Gallo Images / Sowetan / Esa Alexander)