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I have written today to the Auditor-General, Mr. Terence Nombembe, requesting that his office carry out a special investigation into the R22.5-million Sarafina-style theatre production that a DA parliamentary reply revealed the department of human settlements had paid for during the 2008/09 financial year.
A copy of that letter follows below. The Auditor-General of South Africa Private Bag X654 PRETORIA 0001 26 November, 2009 Attn: Mr. Terence Nombembe Sir, I write to you regarding the R22 569 655.65 spent by the (then) Department of Housing on the "A re Ageng Mzansi" campaign, with the request that a special investigation be undertaken of this specific expenditure item as a matter of urgency. According to a parliamentary reply from the current Department of Human Settlements minister, the Honourable Tokyo Sexwale, MP, the department overspent their advertising budget by nearly R40-milllion in the 2008/09 financial year, and this over-expenditure includes the roll out of 58 performances of "A re ageng Mzansi Industrial Theatre" at a cumulative cost of R22.57-million. According to information supplied in the parliamentary reply, Phase 1 and 2 of the industrial theatre production cost R18 091 422.15 and phase 3 cost a further R4 478 233.50. According to the minister's reply, individual expenditure items included within this total of R22.57-million included: · Generic script review · 58 performances across the provinces · Development and 11 language translation of the public · DVD recording of performance · Event logistics costs No further breakdown of costs was provided; I am, however, enclosing a copy of this reply for your perusal. My concerns about this expenditure are as follows: Firstly, the parliamentary reply states quite clearly that the costs of this play fall under the department's advertising expenditure budget. They also state that this budget amounted to R20 303 651.00 in the 2008/09 financial year, but that the total cost actually ran to "approximately R60 million". The reply further notes that the budget was exceeded in large part as a result of the abovementioned theatre production. In fact, it must be noted that, even if the department had run no other advertising cost in 2008/09, the total cost of this theatre production alone would have exceeded the total advertising budget allocated. This inevitably raises serious questions pertaining to budgeting, accounting and general oversight. In particular: · Since the department spent more on this theatre production than they had been allocated for their entire advertising budget in 2008/09, this suggests that either the costs of the production were not budgeted for, or that the specific budget allocated for this particular production was far exceeded. Either way, this would indicate irregularities that need to be accounted for. · Since departments engaged in contracting external services are required to incorporate various safeguards against overspending, such as incorporating penalty clauses, it seems highly irregular that the department in question would need to pick up the costs of such an enormous financial overshoot. Again, this suggests that there may have been serious irregularities, possibly in the tendering stage of this matter. Secondly, Mr. Ndivhuwo Mabaya, the spokesperson of the former Housing Minister Lindiwe Sisulu, has stated in the press this morning that only R5-million of the budget was allocated to the actual theatre production and the rest of the expenditure was allocated to ‘other expenses'. It is therefore unclear on what the other R17.56-million was spent, due to the fact that a clear and concise breakdown of costs was not provided by the department. In the media, the minister's spokesperson has hinted that the costs may have been incurred on expenditure not related to the theatre production. If this is the case, then this ought to constitute another patent reason for a special investigation into this expenditure. Mr Mabaya even went further, and suggested, according to reports, that the actions of the department's accounting officer and Chief Financial Office be scrutinised. While admittedly these statements appear to be little more than an attempt to shift the focus of attention away from Minister Sisulu, it is nonetheless telling that Ms. Sisulu's spokesperson is already apportioning blame, and suggesting that activities of departmental staff be looked into. We would suggest this constitutes another reason for a proper investigation. Finally, there is absolutely no objective basis for the expenditure of R22.57-million on a theatre production that in no way affects the department's ability to deliver on its basic mandate. For this reason, the expenditure item inevitably raises suspicions about why it was even considered in the first place, particularly given the serious service delivery backlogs facing this particular department. For these reasons, and given the importance of upholding the values of accountability, openness and transparency as enshrined in the Constitution, I request that this matter be considered for a special investigation by your office. Yours sincerely AC Steyn, MP
DA Shadow Minister of Human Settlements