By Bheko Madlala and Keeran Sewsunker
Taxpayers will be forking out an extra R5-million on the refurbishment of a Durban building that the department of public works has leased for R4,6-million and cannot use.
The bungled lease agreement for Durban Highway House in Westridge will come under the spotlight on Friday in the KwaZulu-Natal parliament when the controversial departmental head of the provincial public works department, Edmund Radebe, is questioned by members of the public works portfolio committee.
Parliamentarians are trying to untangle a slew of allegations of fraud, misrepresentation and financial bungling.
Earlier this week parliamentarians were shocked to learn that Radebe had allegedly single-handedly saddled the department with a nine-year-eleven-month lease agreement for Highway House without an exit clause.
Premier S'bu Ndebele said the Treasury had been asked to investigate the agreement and some parliamentarians had called for Radebe's suspension.
This has resulted in taxpayers paying for a building that civil servants cannot occupy because of a dispute with existing tenants, who have threatened court action if they are evicted. This is the building now being renovated by the landlord, Barlow Govender, at a further cost of R5-million to taxpayers.
Radebe, who has a controversial past, is a former chairperson of the Playhouse board and left his plum position after he and other fellow members of the board were taped making racist remarks about acting Playhouse MD Gita Pather, who subsequently resigned.
The MPs were told that the saga of the building started when former MEC for public works Mike Mabuyakhulu moved his offices from Ulundi when he took political control of the department in 2003.
Radebe, on his own, sealed the deal with Govender, who is a former employee of the department. According to testimony given to the public works committee, Radebe had not sought the approval of the department's legal adviser before he sealed the deal. It also emerged that he had not considered other reasonable lease options and had tied the department to an agreement which will run for nine years instead of five.
To top it all, he also instructed the department to pay an advance of R4,6-million in March 2004.
The department has discovered that some of the floors are occupied by other tenants who have lease agreements running for years and who threaten legal action should the department try to evict them.
It emerged at the portfolio committee that Govender was still listed as an employee of the department of public works although he had resigned. A source from the department, who spoke on condition of anonymity, told the Daily News yesterday that Govender had left the department in 1997 after he had learned that the department had launched an investigation relating to financial irregularities.
A civil engineer by profession, Govender, 41, founded Intercon Consulting Engineers in 1997.
The fledgling company, based in Cowey Road, specialises in consultancy work and the KwaZulu-Natal provincial government is its main client. The company's contracts with the provincial government are believed to amount to more than R200-million.
Govender's other company is Midros Investments, a property development company whose flagship project The Acropolis Mall was recently opened amid much fanfare in the central business district of Phoenix.
On Thursday, Govender defended the lucrative lease agreement, saying it was a "standard lease agreement".
Despite the fact that MEC for Public Works Blessed Gwala said this week he had instructed his department to put all operations relating to the building on hold, Govender said he was also re-partitioning the building at a cost of R5-million to the department.
He said the building, which is worth R28-million, was currently being occupied by three tenants "illegally".
By the time the nine year-11-month lease expires, taxpayers would have forked out more than R4,6-million.