Date: 26/01/2003
Source: Western Cape Provincial Government
Title: Van Schalkwyk: Alleged breaches by Malatsi referred to Public Protector


STATEMENT BY WESTERN CAPE PREMIER, MARTHINUS VAN SCHALKWYK, ON 26 JANUARY 2003

DAVID MALATSI: FURTHER ALLEGATIONS REFERRED TO PUBLIC PROTECTOR

Based on the facts and events detailed below I have decided to refer alleged breaches by the former MEC for Environmental Affairs and Development Planning, Mr David Malatsi, of the Code of Conduct set out in the Provincial Ministerial Handbook, as well as of the provisions of the Executive Members Ethics Act (82 of 1998) to the Public Protector.

The following facts and events are relevant to this decision:

1. On 7 November 2002, the Director-General, Dr Gilbert Lawrence, and the Provincial Director: Forensic Audit, Ms. Rene Ogle, reported to me that a whistle-blower from the Department of Environmental Affairs and Development Planning had detailed an alleged financial irregularity concerning Mr David Malatsi, and his tenure as MEC for Environmental Affairs and Development Planning.

2. On the same day I instructed the Director-General and the Provincial Director: Forensic Audit to gather all relevant information with a view to ascertaining whether there was any prima facie evidence to substantiate the claims of the whistle-blower.

3. During the period 7-18 November the Forensic Audit division performed an in loco inspection of the premises in question at 21 Koper Street, Bronkhorstpruit. The Forensic Audit division also collected other relevant evidence including, inter alia, sworn affidavits and related material.

4. On 14 November 2002, Mr Malatsi settled the R18000 invoice - seemingly out of his own account.

5. On 18 November 2002, the Director: Forensic Audit submitted to me a preliminary report. The salient points were as follows:
a. Mr Malatsi's Office Head had submitted invoices totalling R18000 for payment by the Provincial Administration in respect of accommodation and subsistence for Minister Malatsi and his driver for six nights during the World Summit on Sustainable Development (29/08/02-04/09/02);
b. This accommodation was actually in a dwelling owned by M. Malatsi's wife;
c. The empowerment organisation, which had issued the invoices, Asibambane Women's Projects, was an organisation in which Mr Malatsi's wife was involved;
d. The premises in question, which had been claimed to be a guest house operated by Asibambane, were not fully furnished, nor equipped with proper sanitary facilities as would be expected of a functional guesthouse in relation to the tariffs charged (R2000 and R1000 per day), nor was there any signage indicating or advertising its use as a guesthouse;
e. That the Treasurer of Asibambane was also the sister of Mr Malatsi's wife;
f. That the Treasurer could not provide the audit team with any financial records and/or documentary proof that the premises were registered as or utilised as a guesthouse;
g. That another premise, 1072 Section D, Ekangala, reflected in the Register of Members Interest as being owned by Mr Malatsi, was occupied by a member of Asibambane and was utilised for the manufacture and sale of gifts;
h. That Mr Malatsi's driver was under the impression that he and Mr Malatsi had been residing in Mr Malatsi's house; and
i. That the invoices in question were handed to him (the driver) by Mr Malatsi's wife with the request to forward them to the Office Head for payment.

The report drew the following preliminary conclusions:

- These actions were "in contradiction with Chapter 1(Code of Conduct), section 46 of the Provincial Ministerial Handbook" dealing with conflicts of interest and improper enrichment.

- These actions were "in contradiction with the provisions contained in paragraph 1.3 of the above Ministerial Handbook in respect of 'Clean Government'".

- These actions were "in contradiction with the provisions contained in Section 2 of the Executive Members Ethics Act, No 82 of 1998".

6. I referred this report to the Provincial Legal Branch to advise me on further steps to be taken, and on their advice I sent a letter to Mr Malatsi on 11 December 2002 in order to clarify certain questions. In this letter I informed Mr Malatsi that it was alleged he had "exposed himself to a situation involving the risk of a conflict of his official responsibilities and private interests", and that he had allegedly "used his official position to enrich himself or improperly benefit another person". I requested him to depose an affidavit to explain his version of the events and informed him that without benefit of his version I would be "obliged to submit the matter to the Public Protector". One of the critical issues which required an explanation was why Mr Malatsi had elected to settle the account personally after the claims for compensation had been submitted and the forensic audit team had performed the in loco inspection in Bronkhorstpruit.

7. On 29 December 2002, Mr Malatsi responded through his attorneys, but did not adequately address all the concerns which had been placed on the table by the preliminary report or the whistle-blower. Mr Malatsi's explanation did not include the requested sworn affidavit. There appears to be irreconcilable differences between the preliminary findings of the forensic report and the response on behalf of Mr Malatsi.

In light of the above considerations, and the possibility that Mr Malatsi breached the Executive Ethics Code during his term of office as MEC, I have decided to refer the matter to the Public Protector who is authorised and mandated, in terms of the Executive Members Ethics Act, 1998, to investigate such breaches.

Enquiries: Riaan Aucamp, Cell: 083-778-9923
Issued by the Office of the Premier, Western Cape Provincial Government, 26 January 2003