Tender processes under spotlight in Post Office report

The report by auditing firm SizweNtsaluba looks at Post Office CE Khutso Mampeule’s reasons for laying charges against his predecessor Maanda Manyatshe, who quit two years ago. Business Day says Mampeule laid a criminal complaint against Manyatshe and two other former Post Office executives over a R100m contract awarded to a company called Vision Design House to upgrade the image of the Post Office. The contract was awarded through a deviation from tender, after an existing tender process was halted. Mampeule firstly cancelled the contract, and then laid the criminal complaint in February last year. Excerpts from the forensic report – as well as minutes of a special board meeting convened in June to discuss the contract issue – shed new light on Mampeule’s decision to lay the criminal charges. The SizweNtsaluba report said Mampeule ‘failed to inform the board of his intention to lodge a criminal complaint against Manyatshe, before February 27 2006, the date on which Mampeule signed the affidavit’. It says in a meeting on Sunday, June 11 2006, four months after laying the criminal complaint, Mampeule said he ‘felt that he did not have the authority, nor the comfort, to make a decision on behalf of South African Post Office to institute civil proceedings against Manyatshe’. But, the report says, ‘(Mampeule) did not apply the same principle in deciding to lodge the criminal complaint against Manyatshe during February 2006’. Full Business Day report

Mampeule is also accused of lying to Communications Minister Ivy Matsepe-Casaburri, and failing to fulfil his fiduciary duties, according to extracts from the forensic report, contained in court files. Based on the report, says Business Day, Matsepe-Casaburri has been planning to fire Mampeule, but the action was delayed when Mampeule won a court battle forcing her to give him the full report so he could prepare a defence. However, Mampeule said he was ‘still waiting for the report’. ‘This is the most extraordinary situation. Following the High Court order on April 20, I expected to be forwarded the report but even though I’ve sent three letters to (Matsepe-Casaburri), I haven’t been given the report’, he said. Effectively, Mampeule claims, this delay may be an attempt to cover up instances of poor governance or corruption committed by other PO directors. Full Business Day report

According to the report, inappropriate and unacceptable comments by Mampeule on November 17 last year were a clear manifestation of the breakdown of his relationship with the board. The report says Mampeule made a public statement that his fight against corruption affected some influential members of the board, according to Business Report. It concluded that Mampeule\'s assertion in the business case for Post Sure that the selection process for the appointment of an insurance partner for the Post Office was done through a closed tender approach was ‘factually incorrect’. Post Sure was the instrument through which Mampeule proposed that the Post Office diversify its product offerings. Andrew Maralack, of SizweNtsaluba, found that Mampeule had lied in his business plan that AIG had offered a proposal in addition to Old Mutual, Hollard, Metropolitan and Sanlam. Maralack said that in response to his letter, Visolution, the company that was appointed by the Post Office to evaluate the insurance companies\' proposals, did not mention that a proposal was received from AIG, thus misrepresenting the board and Matsepe-Casaburri. Maralack also found Mampeule guilty of irregular expenditure by upgrading security at his residence without approval from the chairperson of the Post Office board. Full report in Business Report

In addition, the report has found that the payment of R510 683 to Cormsnet, a recruitment agency, by the SA Post Office was a ‘fruitless and wasteful expenditure’ as its introduction to the parastatal was a result of the active intervention of Mampeule, and not the agency itself. The report, notes Business Report, said that Mampeule approved this expenditure and Maralack attached three affidavits from people who were ostensibly recruited to senior positions that showed that Cormsnet did very little work while Mampeule did all the recruiting. Three other Post Office board members were implicated in the affidavits, although Maralack made no findings on their roles. Full report in Business Report