SABC headquarters. Picture: TIMESLIVE
SABC headquarters. Picture: TIMESLIVE

The SABC's top brass quietly authorised an upfront payment to a company with which it was not allowed to do business just days before Christmas — violating both Treasury and the corporation's own procurement rules.

The company, Infonomix, was paid R5.1-million for redesigning seven SABC websites as part of a five-year contract.

This is one of dozens of questionable deals SABC executives are believed to have rushed through on the eve of the festive season.

Another suspect contract, with audit firm SekelaXabiso, was signed by SABC acting chief financial officer Audrey Raphela two days before Christmas.

The Times has obtained copies of some of these contracts, together with billing schedules, internal correspondence and a payments list.

They show that the deal with Infonomix was authorised by Raphela and the SABC's group executive for commercial enterprises, Tshifhiwa Mulaudzi, even though the company failed a bank verification test and did not have a tax clearance certificate.

This violates Treasury and SABC procurement rules and policies.
Infonomix slapped a R637000 VAT charge on the bill — even though it is not registered for VAT.

The contract stipulates that Infonomix must be paid in full “prior to commencement of the services”. The next day Raphela authorised a special payment request for the
upfront payment, which she released on December 12.

The company is headed by Muthe Rambuwani, who won Standard Bank's Rising Star award in 2014.

Rambuwani declined to discuss his contract with the SABC, or his VAT payment.

“I'm not going to comment on any of that,” he said before cutting the call.

He also failed to respond to detailed questions sent by SMS.

SARS spokesman Sandile Memela said that anyone who “wilfully and without just cause” failed to register for VAT faced a prison sentence of up to two years.

The SABC's end-of-year splurge took place while a parliamentary committee was holding an inquiry into mismanagement at the broadcaster.

In an interim report released on January 27, the committee highlighted the financial cost of flouting governance and procurement rules. The report warned of a “looming financial crisis” that had left the SABC “at risk of becoming technically insolvent”.

Treasury rules allow state entities to deviate from normal procurement processes, such as competitive bidding or sourcing three quotes, if there is an unforeseen emergency or it can be proved that a company is the sole provider of a product or service.

SABC sources said this was not the case with the suspect contracts and payments, the timing of which was suspicious.

“Why would it be necessary to do deviations in December when everyone's going on holiday?” said one.

“And why would you pay upfront when there‘s nobody working?”

Another company that benefited from the SABC's festive season rush to pay suppliers contracted without tendering or required procedure being followed was SekelaXabiso.

Ironically, the auditing firm was contracted to deal with irregular expenditure findings by the auditor-general that had amounted to R5-billion by the end of the 2016 financial year.

The firm was flagged by the parliamentary report under the heading “suspicious transactions” because of what appeared to be irregularities in the awarding of contracts in the past two years.

Most of the contracts were signed by former COO Hlaudi Motsoeneng and acting CEO James Aguma.

The Sunday Times previously reported that Aguma had authorised irregular payments of R10-million to auditing firm PwC and awarded a lucrative contract to debt collection company Lorna Vision without inviting tenders.

Lorna Vision and PwC were also both flagged in the parliamentary report.

The report quotes “oral evidence” by the SABC‘s former head of procurement, Madoda Shushu, who said there was no justification for deviating from normal supply chain rules for the Lorna Vision contract.

“This contract did not meet the requirements of a deviation,” he said.

Early in December former SABC group executive for risk and governance Itani Tseisi told the parliamentary inquiry that contracts were awarded to SekelaXabiso “with little regard for supply-chain management regulations”.

Despite Tseisi‘s warning, Raphela signed a new nine-month contract with Sekela- Xabiso worth R9.8-million on December 23.

- The Times

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