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Friday Sep 28, 2012

Investigators find more cracks at builders' council

The Special Investigating Unit (SIU) is investigating further cases of malpractice, irregularities, nepotism and corruption at the National Home Builders Registration Council (NHBRC).

Human Settlements Minister Tokyo Sexwale said a "very scandalous and unacceptable thing" had also happened in one of the provinces, which had just started building houses "by themselves".

Sexwale declined to identify the province or provide further details at this stage concerning what had occurred, only saying "we are dealing [with] and focusing on this problem".

Speaking at a briefing on the new members of the NHBRC board, Sexwale said his department had demonstrated its seriousness in dealing with the problem through the gazetting of Proclamation 35 by President Jacob Zuma, which empowered the SIU to conduct its investigations.

"To date, more than 5 000 people have been arrested and charged, companies have been blacklisted, individuals have been publicly humiliated and monies have been recovered."

Sexwale said the human settlements minister had to take responsibility for irregularities conducted by the provinces but stressed money was spent by the provinces and it was only when an audit was done that it was discovered "wrong contracts have been given, wrong tenders issued, favouritism, nepotism and the tsotsiism of public funds" had taken place.

The situation was so bad that "the [chief executive] had to be shown the door", he said in a reference to the recent dismissal of former NHBRC chief executive Sipho Mashinini after he was found guilty by an internal disciplinary hearing on charges of financial misconduct and corruption.

Mashinini was chief executive when the NHBRC offered Vanessa Somiah, who was investigating the organisation for corruption, a job with an annual salary of more than R1 million. The salary was allegedly nearly double her pay as leader of the SIU tasked with probing allegations of corruption in public housing. Somiah was removed from her post in July last year.

Brenda Madumise, the newly appointed chairwoman of the NHBRC board, said the council was "going to be a different organisation" with the new members on its board.

"South Africa is going to get results from us, especially in the subsidy market. That is where there is a lot of outcry and concerns. If it means we lock up people in the provinces who don't enrol projects, we are going to do that.

"Watch this space because it's going to be a rough ride for our colleagues in government as we continue the work we do in the non-subsidy market and deliver on our mandate."

Sexwale referred to the "staggering" R50 billion rectification bill for shoddy workmanship on previously built Reconstruction and Development Programme houses.

Since the NHBRC's establishment it had registered projects, but insufficient work and attention was paid to its core responsibility of regulation to ensure quality workmanship.

Sexwale expressed confidence that the new board members had the necessary understanding and commitment to rectify the serious underperformance of the NHBRC.

Acting chief executive Jeffrey Mahachi said the NHBRC used outsourced inspectors and mobile technology for the non-subsidy sector and had one inspector for every 200 subsidy sector houses under construction.

However, Madumise said quality assurance was core to the NHBRC's business, "warm bodies" were needed to do this and the NHBRC's management had proposed putting a further 400 inspectors on the organisation's books to build capacity to fulfil its core mandate.

Business Report

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