The ANC Joburg Region has issued a press statement in which they allege that the City of Johannesburg Mayor Herman Mashaba has once again illegally entered the procurement space.
According to the statement, “Firstly it was a free service from an old business associate and now its payment of over R 11 million to the Mayor’s favorite NGO. In the latest episode, the Mayor has now brought his erstwhile NGO; the Field Band Foundation (FBF) to provide services to the Municipality for over R11 million.
“Mayor Mashaba initiated funding for the FBF without any written proposal sent to the City by the Foundation. Mayor Mashaba was the Chairperson of the Field Band Foundation for over 16 years. The FBF is a well-established NGO with support from the private-sector, and boasts a budget of R22 million per annum, yet Mayor Mashaba has the audacity to initiate funding of over R11 million from the rate-payers money to fund the FBF.
“He resigned as Chairperson of the Foundation in 2016 shortly before the Local Government Elections. Six months into office the Mayor initiated a process for the funding of the FBF by the Municipality. In February 2017, the Mayor mooted that the City would be rolling out a City-wide Anti-Drugs Abuse Awareness Campaign over a three year period. He also announced at this meeting that the City would need to set aside R3.5 million per annum for the project whilst there had been no request for funding or a partnership between the City and FBF. The Foundation only submitted a proposal to the City in June 2017.
“After the February 2017 Mayoral Committee meeting, the MMC for Health and Social Development Ms. Mpho Phalatse wrote a letter to then MMC for Finance Mr. Rabelani Dagada requesting three year funding for FBF despite the fact that there had been no proposal or request for funding from the FBF at the time. As a result of the written request from MMC Phalatse, the City budgeted an amount of R3.5 million per year over a three year period for the funding of the youth program to be rolled out by the FBF. The indicative budget for Social Funding within the Health and Social Development Department increased by R3.5 million in the 2017/2018 financial year.
“In March 2017, the MMC for Health and Social Development Ms. Phalatse then convened a meeting with the Field Band Foundation management team to inform them about the Mayoral Committee decision to fund the NGO. The NGO then undertook to submit a proposal to the City in line with the City’s offer for funding. In June 2017 the Foundation then submitted a proposal for funding to the tune of R10.5 million.
“On the 20th September 2017 at the Special Mayoral Committee meeting, the Mayoral Committee approved funding amounting to R 11.1 million “adjusted” in respect of inflation over the life of the project to the Field Band Foundation. This was done despite the FBF submitting a proposal for R10.5 million over a 3 year period. With 22 years of experience in submitting proposals for grant funding, the FBF knew exactly what the costs would be over a 3 year period. However, the City was generous enough to increase the grant from the initial proposed R10.5 million to R11.1 million.
“In October 2017 a meeting between the City of Joburg and FBF took place where the City was represented by the Director in MMC Phalatse’s office. It is at this meeting where the FBF was informed about the decision of the September 2017 Special Mayoral Committee meeting to increase funding for the youth program from R10.5 million to R11.1 million. The Field Band Foundation was then requested to submit a revised proposal requesting R11.1 million. The Foundation obliged and submitted a revised proposal in November 2017.
“In December 2017, the Field Band Foundation and the City of Joburg concluded a Grant Agreement and in January 2018 FBF submitted a request and invoice for an upfront payment of R3.5 million to the City of Johannesburg. In February 2018 the City paid an upfront amount of R 3.5 million to the FBF.
“In its quarterly report to the November 2017 Council meeting, the Health and Social Development Department indicated that between July and September 2017 it called for proposals from NGO’S for funding in line with the Pay Per Service Policy of the City. The department then indicates that 93 proposals from NGO’S were received and none of them met the set criteria for funding. Could this explain the ring-fencing of R11.1 million for the Field Band Foundation partnership at the expense of 93 NGO’s that do work on a daily basis to assist vulnerable communities?
“In February 2018, the City adjusted its budget downwards by R1 billion due to the financial crisis faced by the City. As a result of this downward budget adjustment several service delivery projects were affected. Miraculously, the City has R11.1 million to give to the Mayors favorite NGO for a City-wide Drug Abuse Awareness Campaign of which they admittedly have very limited or no expertise to provide.
“Having stated all the events and circumstances related to the funding of the Field Band Foundation; the following observations are made:
Mayor Mashaba used his power and influence to coerce the City of Johannesburg to give the Field Band Foundation a grant of R11.1 million (A case of conflict of interest).
The Mayor chaired the February 2017 Mayoral Committee meeting and the Special September 2017 Mayoral Committee meeting wherein the decisions to fund the FBF were taken
The Field Band Foundation never submitted a proposal to the City requesting funding prior to the February 2017 Mayoral Committee meeting
The FBF was approached by the City of Johannesburg through MMC Phalatse to submit a proposal for funding in March 2017
The FBF does not have experience in running an Anti-drugs abuse campaign
The FBF requested, after being approached by the City of Johannesburg a total of R 10.5 million yet the City approved a total of R 11.1 million
The City of Johannesburg municipality committed an amount of R 11.1 million over a period of 3 years for the FBF project even before the Foundation could submit a proposal for such funding
“The ANC in the City of Johannesburg welcomes programs aimed at developing the skills of our youth and the curbing of drug abuse. However, we will not sit idle when Mayor Mashaba uses his position to coerce MMC’s and staff to take decisions to fund a pet project he has been associated with for over 16 years. We have submitted relevant documents to the Public Protector and will ask the Speaker of Council to refer the matter to the Ethics Committee of Council,” the statement concludes.