R58 MILLION BAHLODI HOUSING SCANDAL DRAGS ON

More than three years ago, in March 2007, then premier Mbhazima Shilowa promised legal action to recover R58 million from Bahlodi Construction Consortium which failed to build a single house in Evaton.

But not a single cent has been recovered so far as the Gauteng Housing Department has switched to arbitration instead of court action against this company.

This is revealed by Gauteng Housing MEC Humphrey Mmemezi in a written reply to my questions in the Gauteng Legislature.

According to Mmemezi, the department's forensic investigators and lawyers "advised that any dispute to the contract between the parties should be litigated by way of Arbitration proceedings." This arbitration process is based on the findings of a forensic investigation.

This is very strange since last year the department said in a written reply that a claim against the company would  be lodged in court by September 2009, just before the three year prescription period for such a claim lapsed at the end of November 2009.

It is really unacceptable that this case has dragged on for so long. It undermines Gauteng Premier Nomvula Mokonyane's commitment to fight corruption, especially since she was Housing MEC when Bahlodi was paid but failed to deliver houses.

Could this be because Bahlodi has high-level political friends? Its CEO Aziz Kara is a controversial figure who was banned from soccer activities for 10 years  because of a bribery scandal.

The contract was first awarded in 2004. We need to know who awarded the contract to Bahlodi and why money was paid out for three years despite non-delivery.

In my view, fraud charges should have been laid against the company long ago, and money recovered through the Asset Forfeiture Unit.

There has been no accountability whatsoever in this whole matter, as not a single official has been disciplined for what was clearly gross negligence at best, or collusion with fraud at worst.

This is why I am skeptical about anti-corruption pledges such as that made at yesterday's Gauteng Anti-Corruption Summit.

The small fish are caught and prosecuted, but the big fish with political connections usually get away with it.

Statement by Jack Bloom MPL, DA Gauteng Corruption Spokesman, November 25 2010

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