Fort Hare overpays R63m for work done on residences

Some of the funds were paid two years before the work was completed.

Moreover, the company was registered only three months before the multimillion-rand tender was awarded.

The shocking revelations are contained in a 100-page report, titled Forensic Investigation on behalf of University of Fort Hare into Lease Agreement for Students Accommodation, done by Sizwe Ntsaluba Gobodo (SNG).

The damning report was released in June.

SNG investigated contracts awarded to two companies - Equicent Infrastructural Development and the SKG Group.

The report reveals that the university awarded the multimillion-rand tender to Equicent Infrastructural Development to refurbish the residences - but the work was instead done by a company called Equicent Eastern Cape Development.

Equicent Infrastructural and Equicent Eastern Cape had three common directors - Mazwi Yako, Younis Atcha and Mark Corbett.

According to SNG, when the bids were submitted in April 2012, Equicent Eastern Cape had only been in existence for three months and did not bid for the tender.

"It appears that UFH concluded the contract with the company that did not submit the bid," the report said.

The report further revealed that invoices of "finished work" worth millions were paid two years before the actual work was to be finished by Equicent.

This is blamed on two senior UFH employees who allegedly recommended that the invoices be paid, without verifying their correctness or the supporting documents.

The number of beds that Equicent invoiced for in respect of refurbished buildings was also more than the number of beds that UFH has on its records.

"Based on the invoices reviewed, the overpayments made to Equicent totalled R62936201.87," the report said.

It said two staff members, the late Vuyisile VG James and chief financial officer Robin Stone, had been responsible for approving the invoices for payment.

"Mr James and Mr Stone recommended and approved invoices for payment in respect of management fees for maintenance without an approved and accepted agreement," the report said.

"The first addendum to the agreement relating to management fees for maintenance was approved and accepted by UFH on October 8, 2015 and the invoice was recommended for payment on October 4, 2013 and approved on October 10, 2015."

In return for the work done at UFH, Equicent was to be paid 7.5% of the fees the university would have collected from the residences.

On completion of the refurbishment, the 7.5% arrangement was to fall away and the contract arrangement would kick in.

But apparently the percentage was increased to 10% without all stakeholders being consulted.

The university's legal adviser, Mzimhle Popo, said he had been asked by former deputy vice chancellor Dr Jabulani Mjwara and James and Stone to commit the university to amounts expressed in percentages - the value of which he had no idea.

Popo told the investigators he was not aware that the request by Mjwara, James and Stone was not included in the agreement.

According to the report, Stone could not explain the basis for the 10% and there was no documentary evidence indicating how this percentage was derived.

Equicent's Japie Vos said: "The university regrettably requested that we do not reply to your questions at this time as this matter is still being handled by the university's council."

Source: Herald