Ekurhuleni awarded R3.4m tender to Cat Matlala’s wife despite ‘red flags’
· Citizen
In 2023, the Ekurhuleni municipality’s Human Resources Department, Strategic HR and Talent Management, advertised a tender for accredited skills development providers to implement various qualification and skills programmes.
Visit asg-reflektory.pl for more information.
The training would be on an as-and-when required basis from the date of award until 30 June 2026, and the closing date to apply for the tender was 24 July 2023.
The bid was advertised on 15 June 2023.
Although the advertisement was issued in the name of former Ekurhuleni city manager Imogen Mashazi, suspended Ekurhuleni head of HR, Linda Gxasheka, told the Madlanga commission on Friday that Mashazi could not have been involved in the tender processes.
Mashazi’s involvement would only be to appoint the bid specification committee, bid evaluation committee and the bid adjudication committee.
Gxasheka said she, too, was not involved in the processes.
One of the successful bidders was Buena Vista Learning Academy and was awarded in November 2023.
Ekurhuleni tender ‘red flags’
The commission reviewed what they regarded as “red flags” that should have disqualified the company from the tender bid.
The company was controlled by Tsakane Baloyi, the wife of tenderpreneur Vusimuzi ‘Cat’ Matlala. The company’s registered address was the same as Baloyi’s residential address.
Two previous directors had resigned, and Baloyi became a director of the company on 26 June 2023.
This was a week after the bid invitation was advertised and less than a month before the closing date.
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As a director of this company, she applied in the name of Buena Vista Learning Academy, but at the time she became a director, the company was called Mokoko Grill. It was a shisanyama company.
There was a name change on 11 July, after the bid was invited and less than two weeks before the deadline. Mokoko Grill became Buena Vista Learning Academy.
The total bid price was R66 500, but from 23 July 2024 to 5 September 2025, the company was paid R3 484 987. Asked why this was the case, Gxaleka answered: I won’t have clarity on that; I’m not an expert on that. But on the spreadsheet, it will show the training allocation as required by departments, where she will then go to train. So these are payments that are made.”
Seta grants
The municipality did not have a budget for these payments, so they came from the Sector Education and Training Authority (Seta) grants the municipality had access to. “The departments will ask for a particular training, and then we’ll allocate that training for that department, and once they are done with the training, it will be paid from the Seta’s grants,” she explained.
According to the Central Supplier Database (CSD), the company was registered on the system on 20 July 2023. So the company was registered with the CSD four days before it submitted the bid application.
It also obtained its BEE certificate four days before it submitted its first BEE certificate. The company’s bank account was opened on 17 July 2023.
The CSD report further showed that the company was not VAT registered. However, the turnover claimed in the bid application was R35 million in the previous financial year.
Ekurhuleni tender fraud?
The industry classification for Buena Vista Learning Academy states that its core industry was construction, not training.
“So, there seems to be a fraud of some sort taking place here. Either it’s a VAT fraud, or this turnover figure is a fictitious figure,” commented evidence leader Matthew Chaskalson.
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“Either way, there is a fraud, either on the city or on the receiver. There definitely seems to be fraud against the city or the department of finance, because although the bid says we saw an annual turnover of R35 million, the CSD registration says the total annual turnover is R10 million or less. So one of those two figures must be lying, possibly both.”
“Without having technical knowledge, I fully agree. As I say, finance, they can answer better on this, but us, seeing here, I fully agree with you,” responded Gxasheka.
“From my level, it looks like there are some discrepancies. Unless they say they are training in the construction of buildings, I don’t know. But from what we see, I see those irregularities.”
Gxasheka: ‘This looks very strange’
The CSD report also showed that the legal entity was a company, not a joint venture. However, in reality, it had signed partnership agreements.
The bid was supported by a subcontracting agreement in which the principal is CTC College, PTY Ltd., and the second partner was Buena Vista.
It had signed another partnership agreement, described as a memorandum of understanding, between Leda Cleaning and Security and Buena Vista Learning Academy.
“The bid had to be based on partnership, because Buena Vista, being a shisanyama company until recently, was in a completely different industry and had no training accreditations of its own,” said Chaskalson.
“There are no training accreditations that Buena Vista itself had. Would you agree that if Buena Vista had no training accreditations of its own, it couldn’t qualify for this bid?”
“I’m going to repeat that I’m agreeing with you from the layman’s point of view. I don’t want to say I’m talking here on behalf of the finance department,” responded Gxasheka.
“From the layman’s point of view, I’m sure finance will have reasons and understanding of how subcontracting works. So I don’t want me conceding to be a position of the finance department. I’m just saying, from the layman’s point of view, all this looks very strange.”
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