Employment and Labour Minister Thulas Nxesi has been fingered as a person of interest for the Hawks and the Special Investigating Unit (SIU) following an investigation into fresh allegations of corruption involving approximately R3-billion.
This after a senior government official who has turned whistleblower drafted an explosive affidavit implicating Thulas Nxesi and his former director-general (DG), Thobile Lamati as the masterminds behind the scheme to irregularly pump millions of the labour activation programme funds to companies without following due process.
The official, who cannot be named because of the death threats she is receiving (please the story below), has also implicated 10 more departmental officials in the alleged corruption. But as stated in records before the law enforcement agencies, the official is ready to testify in court against the minister and other suspects.
Nxesi and Lamati, who have recently been at loggerheads over the frozen R5-billion job creation deal involving the Unemployment Insurance Fund (UIF) and Mthunzi Mdwaba’s Thuja Capital, are implicated by the official as key players in the irregular awarding of funds to companies that created jobs through training unemployed people.
The official sent the explosive affidavit to the Hawks under oath and on condition of immunity from prosecution in June.
In the affidavit, the official confirmed she made the statement freely, voluntarily and without duress and that it contained information that might incriminate her in various offences.
“I may be called as a witness on behalf of the prosecution and further be required to answer questions, frankly and honestly, that can implicate me, but that, if, in the opinion of the court, I answer questions frankly and honestly, I will be discharged from prosecution on such charges or any competent verdict therein, and that the contents hereof may not be utilised in any manner or regarded as admissible evidence in any court against me.
“I am requesting your good office to protect the source of information, who happens to be me,” said the official.
In the scheme, alleged the official, Thulas Nxesi would give directives to Lamati, who then passed the unlawful instructions to UIF commissioner Teboho Maruping. Maruping would ensure the execution of the instructions.
“Such instructions are to appoint illegal companies. The minister also gave direct directives to me,” she states in her affidavit, which we have seen.
The other prominent figures implicated by the official are UIF chief operating officer Marsha Bronkhorst, former UIF board chairperson Thulani Tshefuta, communications chief director Tebogo Thejane, chief financial officer Fizile Puzi, among others.
The service providers mentioned are Lulaway Holdings of Andile Skhosana, South African Digital Organisation (Sadico) of Linda Khumalo, Fuze Institute for Humanitarian and Development, Praxis of Thandi Ngcobo, Inqaba Yokulinda Youth Organisation of Busi Khoza, Royal Academy Racing of Phindi Kema, Rothe Plant- scapers of Sello Malatji and Imbizo Solutions of a person only mentioned as Thabo.
By the time the whistleblower deposed to the affidavit, more than R668-million had been paid to, among others, Lulaway in Gauteng (R13-million), Sadico in the Eastern Cape (R38-million) and Fuze in KwaZulu-Natal (more than R617-million). Lulaway committed to creating 7 810 jobs in 12 months, Fuze to 19 921 jobs in 36 months, and Sadico to 525 jobs in 12 months.
The adjudication for the appointment of more companies was delayed, and during that time, the whistleblower learnt that an internal audit had raised concerns about adjudication done in the labour activation programme without advertisement.
“I picked up that there was an invisible force that the team was so scared of if they stop preparations for adjudication. I told them that a pause does not mean totally stopping adjudication… One of the colleagues said DG was not going to agree with the pausing. I said it’s worth making an effort.”
Similarly, the remaining 34 companies were adjudicated without advertising and also recommended for appointment. “If the plan was innocent and clean, why did the DG agree with the UIF commissioner that the probity process should not be done during the sourcing of labour activation plan? The probity process is a control that the UIF uses to check the integrity of the process of sourcing service providers”.
The whistleblower alleged they were victimised for refusing to sign proposals sourced without advertisement.
This was done in order to commit funds without a person who was going to tell the UIF and the department of employment and labour that the process was flawed.
The whistleblower said they were also among those against the Thuja deal, but Maruping wrote a motivation for its approval without due process.
She added that an amount of about R36-million paid to Productivity SA, then chaired by Mdwaba, was not accounted for, and then UIF board demanded that the amount be paid back and the responsible persons be reported to the police.
The Department of Employment and Labour said on Friday night that Nxesi rejected “the absurd accusations with contempt.”
Thejane said it was clear that the statements were intended to defame and denigrate Nxesi.
“We hope that these misleading informers are not fighting back against the anti-fraud champion, the fight against corruption and good governance.”
Thejane said Thulas Nxesi did not issue administrative and operational instructions to officials. “The minister works through the director general and respects public officials as professionals and experts in their fields. The minister focuses on issues of legislative mandate, policy, and giving strategic direction and oversight”.
Generally, he said, “the minister encourages fellow South Africans that any one of them who has witnessed malfeasance should quickly approach the country’s law enforcement agencies and/or some relevant institutions that are constitutionally enshrined and report what they have seen”.
SIU spokesperson Kaizer Kganyago said the matter was under investigation.
Hawks spokesperson colonel Katlego Mogale referred questions to police brigadier Athlenda Mathe, who went on a tirade.
“If such an affidavit is indeed in your possession or you may have seen its content, it is unethical and also criminal as it may interfere with the administration of justice.
“Secondly, in our nature as SAPS, we do not discuss issues of investigations in the media,” she said.