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Finance Minister, Enoch Godongwana, says he was deeply concerned about the integrity of the decision by Nelson Mandela Bay Metro to endorse the appointment of Anele Qaba as the new CEO of the Mandela Bay Development Agency.
In a letter to Mayor, Gary van Niekerk, following a meeting on Tuesday, Minister Godongwana also emphasised his concern over the governance of the MBDA board in implementing what he said were irregular decisions that contravene statutory prescripts.
He said the MBDA Board also failed to obtain Council approval to appoint Qaba, who was previously suspended for gross misconduct but left following a R3 million settlement agreement with the City.
Minister Godongwana said he viewed this payment as a fruitless and wasteful expenditure that must be recovered.
He said there was no rationale in settling the matter with higher costs and then reappointing the same person into a higher position in less than four months.
"The fact that the Board of Directors failed to consult Council is a clear indication that they have failed to execute their fiduciary duties and therefore I advise your Council to consider taking appropriate steps against them which may include possible dissolution subject to due processes," Godongwana said.
"I also advise the Council to take steps against the City Manager in line with Section 32(b) for the loss incurred as a result of the settlement agreement between the City and Mr Qaba."
The Finance Minister also took aim at City Manager, Dr Noxolo Qwazi, who faces fraud and corruption charges.
"I am equally concerned that the City is led by a City Manager whom herself is alleged to have contravened various provisions of the legislation when appointing Pelatona for the construction of singular toilets, water standpipes, and aerators as a COVID-19 intervention in informal settlements, despite the fact that there was already an existing contract in place for this purpose," Godongwana said.
Minister Godongwana called for a review of Qaba’s appointment to the MBDDA and that the settlement paid to him must be recovered. He also called for disciplinary action against the City Manager.
“I will be prepared to transfer the funds to the City as soon as possible on condition that the municipal Council furnishes me with a resolution of commitment to resolve the above serious matters of concern and to enforce good governance practices when dealing with such matters,” Godongwana said.
“The resolution must also commit not to transfer any funds to the entity until the appointment of the CEO is rectified,” the Minister added.
DA caucus leader and former mayor, Retief Odendaal, said that the Minister’s letter to the mayor vindicates their stance on Qaba’s “irregular appointment.”
He said National Treasury was withholding hundreds of millions of rand in grant funding from Nelson Mandela Bay due to the appointment of Qaba, a former Executive Director for Economic Development and Tourism in the Metro.
“In 2020 the DA laid criminal charges in respect of alleged fraud and corruption by municipal officials in relation to a Covid-19 contract awarded to the company, Pelatona. This culminated in a number of findings by the Special Investigation Unit which implicated officials in potential wrongdoing.”
“Council launched a high court challenge to the findings but the application was dismissed. The minister indicated that due to the court having made a ruling on review, nothing will prohibit Council from instituting further disciplinary processes against Nqwazi,” Odendaal said.
Meanwhile, Nelson Mandela Bay's government of local unity will be seeking legal opinion in the ongoing impasse with National Treasury which is withholding millions in grant funding.
City spokesperson, Kupido Baron, said that the government of local unity held an urgent meeting today to discuss the Minister's second letter regarding the grant funding, following engagements this week.
He said the meeting decided to obtain a legal opinion by providing objective facts to an advocate.
Baron said this was necessary to avoid irregular, fruitless, unnecessary, and wasteful expenditure.
In addition, a response from Executive Mayor Gary van Niekerk will be sent to the Minister of Finance which will include an urgent meeting request with the Minister of Finance.
