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VUMA E3M PAYOUT CONTINUES TO HAUNT GOVERNMENT

21/04/2022 09:00:00 Ntombi Mhlongo

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LOBAMBA - The E3 million spent on the engagement of a South African (SA) media reputation management company continues to haunt government.

This was evident yesterday when the Cabinet Office’s appearance before the Public Accounts Committee (PAC) was short-lived, as the government officers were chucked out for failure to present tangible evidence that the country received its value for money when it engaged SA company, Vuma Reputation Management (Pty) Ltd. During the PAC sitting yesterday, the Private and Cabinet Office was asked by members of the committee (PAC) to provide evidence that the company deserved to be paid the around E3 million for services it rendered to government. The demand for the justification comes after the Auditor General (AG), Timothy Matsebula, noted in his report of the Consolidated Government Accounts that the Private and Cabinet Office entered into a contract with the company for branding and management of the reputation of the country.

Services

The AG noted that an amount of E3 000 006 was spent in the financial year ended March 31, 2021, for the professional and special services of branding and management of reputation.
However, the AG said payment vouchers were not supported with the procurement and commitment authorities, particularly the Commitment Authority and Tender Board Authority, Standard Terms and Conditions and Terms of Reference, as well as proof of deliverables (work done) to monitor the deliverables from such a contract. Furthermore, Matsebula noted that retainer fees were paid as per the contract without any document substantiating service delivery.

Engagement

It was mentioned in the report that Cabinet approved the engagement of the company on a contractual basis, on a one-year renewable contract, over a four-year period. The contract price consisted of a monthly retainer fee of E375 000 for the first three months and thereafter E208 334 per month till the conclusion of the contract. Matsebula said he informed the controlling officer that there seemed to be an alarming risk that the payments were made for non-existent service delivery, as well as fruitless and wasteful expenditure. He said he also warned the controlling officer that public funds should be spent on goods and services that yielded ‘value for money’ for the government, and advised that contracts outlining the expected articles, terms of references and mechanisms to monitor deliverables, should be drawn up with well-defined deliverables.

Matsebula said while the controlling officer’s response was noted, it was not satisfactory since the payments of retainer fees were processed without supporting the vouchers with the documents substantiating service delivery. Furthermore, the AG said the response did not state how the considerations for ‘value for money’ were assessed, why the single procurement method was used, why the competitive bidding was not considered, and how and why the engagement of a brand and reputation management services were classified as emergency.
During the sitting yesterday, Under Secretary (US) Nhlanhla Mnisi, informed the PAC that when the company was engaged, the assistance of the private sector was sourced for the payment of the company’s services until such a time when government was to then take over.

Private

Mnisi said the private sector paid from January 2020 until April and then the month of May was when government took over. The US informed the PAC that the South African company did produce a report in order to justify that indeed it deserved to be paid for its services. “There is a report that Vuma prepared and submitted. Even though it is bulky, it can be shared,” he stated. However, his submission seemingly did not satisfy the PAC as its Chairperson and Gege MP Musa Kunene, said it did not make any sense if there were no attachments of the said report. Kunene then asked to know if the company did achieve whatever government had assigned it to do, including protecting the country’s reputation. He also asked if the company ever worked with the Office of the Government Spokesperson.

“The AG’s report talks about double payments made to the company. Is there any tangible evidence to prove that work was done?” asked the chairperson. He also asked government to explain where it sourced the funds to pay the company since the engagement was done quickly. “Iluhlata lentfo lena,” he said in vernacular which means: “This does not make sense.”
PAC Vice Chairperson and Madlangempisi MP Sibusiso ‘Scorpion’ Nxumalo also sought answers on the issue, saying there was a need for proof that the country got its value for money in the deal with the SA company. “We have seen stories being reported where it was mentioned that there was no comment from government, so what exactly did this company do? So from this contract, what did government achieve and were there recommendations made after a report was compiled and submitted by the company?” asked the Madlangempisi MP.

Answers

Also seeking answers was Mangcongco MP Oneboy Zikalala, who said there were a lot of irregularities in the whole deal. Zikalala asked to know if government had first conducted its own research to ascertain where the company had worked before and if it did a commendable job. “Whose friend is this company? I am asking because the country was continuously bashed on social media, and one wonders where this company was. Kuganga loku,” said Zikalala. Principal Secretary (PS) in the Private and Cabinet Offices Bertram Stewart was seemingly ready to provide answers, but the PAC chairperson simply ruled that the team should go back and work on the answers requested by the committee. “Just go back and find answers. We will give you a date where you will come back with documents supporting all the evidence that you have. We do not accept your responses,” said the chairperson.
On another note, the PAC sitting, being the first one this year, started off on a bad note. This is because it was delayed for over an hour following that microphones were not functioning.

The sitting was supposed to start at 10am but eventually kicked off way after 11am. It was reported that the Parliament officer responsible for the microphones had challenges upon his return from neighbouring South Africa. Clerk to Parliament Benedict Xaba apologised for the delay and thanked the PAC members for their patience as the challenge was being sorted.
The PAC’s primary role is to scrutinise public accounts and make those who owe government settle their bills if the matter is not forwarded to the Losses Committee. The PAC draws its powers to summon witnesses from Section 129 (5) of the Constitution, which states that a committee shall have the powers, rights and privileges of the High Court of a Justice of the High Court at a trial. These are enforcing the attendance of witnesses and examining on oath, compelling the production of documents and issuing a commission or request to examine witnesses abroad.