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Blade Nzimande, Minister of Higher Education and Training, has been trying to keep a report about the disappearance of millions of Rands from his department under wraps.
The Sunday Independent today lifts the lid on the Nexus Report, which Nzimande has asked parliament to keep “confidential,” revealing how ten projects milked the National Skills Fund’s (NSF) coffers on unverified skills development expenditure. The NSF is in charge of managing at least R2.5 billion earmarked for youth assistance.
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According to the report, the NSF funded these projects to ten different entities in the hope of training and empowering thousands of unemployed youth across the country, but investigators discovered that millions of Rands vanished with no supporting documentation.
Sunday Independent can published that the investigation by Nexus Forensic Services reveals that:
- Million of rands were transferred into unknown bank accounts shortly after NSF deposited the funds for a project,
- Some of the payments from an R33.9 million project “were made with a criminal intent of committing fraud and theft,”
- No evidence that students were indeed trained after a project worth millions of rands for training was approved,
- One company submitted names of students that were trained elsewhere as their graduates,
- Another company “applied for voluntary sequestration” after receiving R15.2 million for a project, and
- R131 million project fund advances, from one company, “could not be verified with bank records, supplier invoices and reports.”
These are some of the shocking revelations that Minister Nzimande refuses to make public. Nzimande requested the report’s confidentiality in a letter to the chairperson of the Standing Committee on Public Accounts (SCOPA), Mkhuleko Hlengwa, stating that “all the people whose names are mentioned in the report have not been engaged at all while the department is finalising its internal processes.”
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The minister requested that the report be kept confidential “until all the processes before the law enforcement agencies and internal departmental disciplinary processes are concluded.”
Nzimande went on to say that he “submit that our request for confidentiality is reasonable and justifiable in an open and democratic society like ours and would not want to be the ones violating people’s rights to a fair trial.”
According to a member of parliament who leaked the report to the Sunday Independent and requested anonymity, Nzimande was attempting to keep the report confidential in order to protect certain individuals.
The Nexus report, which was seen by the Sunday Independent, looked into:
- An R39.6 million project to train youth in KwaZulu-Natal after the company submitted an “unsolicited proposal” to train 115 learners on rabbit farming,
- The company promised to build an abattoir that will process 96 000 rabbits per annum and breed about 10 500 others, but investigators found that the company had only 450 rabbits, no abattoir facility was ever built and “no rabbit meat has been produced for local and export markets” as per their project proposal,
- R35.1 million was spent “without any supporting documentation.”
- Some of the students told investigators that the course they attended was not beneficial “because the skills taught will not be applicable anywhere.” And less than 100 learners were allegedly trained.
- An R11.6 million project was funded to train 300 youth on clothing, textile and footwear in Limpopo, but “no evidence was obtained that students were indeed trained,”
- R10.9 million was transferred to an unknown bank account shortly after NSF deposited the funds for the project.
- An R33.9 million project was funded also in Limpopo to train 1 025 learners on basic agricultural programmes, but at the time the project was awarded, the institution’s “accreditation with the African SETS had lapsed,”
- About R9 million “remains unaccounted” and investigators deemed the project to be “irregular, fruitless and wasteful expenditure.”
- An R15.2 million project was funded for a nationwide “capacity development for student leadership” and the company applied for voluntary sequestration after receiving the funds,
- R4.3 million paid into an unknown account which created “a reasonable suspicion of corruption, theft or fraud.”
- An R31.1 million project was funded to benefit 488 learners,
- An R187.4 million project was funded to train 1 025 learners over nine months and R131.5 million of that money couldn’t be verified with bank records, invoices and reports, as the company awarded the project failed “to provide supporting documentation relating to their expenditure.”
Investigators concluded that the NSF “irregularly” awarded R27 million to an Ekurhuleni-based institution for a project after it submitted a proposal containing “several mathematical errors.”
A Cape Town-based institution was awarded R13.4 million for a project and spent nearly R10 million on two service providers, but failed to submit “documentation for these payments,” despite the fact that the service providers are business associates of the institution’s owner.
Hlengwa did not respond to questions about whether he will grant Nzimande’s request to keep the report confidential.
Nzimande’s spokesperson, Ishmael Mnisi, confirmed on Friday that the department opened a criminal case against all those named in the report on Monday at Pretoria Central Police Station.
“We opened a criminal case and we are going to give the law enforcement agencies a chance to tell us who are they going to charge and what charges they are facing,” Mnisi said.
Former Scopa chairperson Themba Godi called Nzimande’s request to keep the report private “misguided” and “astonishing.”
“The National Treasury once requested that we shouldn’t discuss a forensic report on the Integrated Financial Management System (IFMS) until they have engaged people mentioned in it. I dismissed that request and insisted that they submit it to us and we had an open committee meeting.
“The fact is when the report was researched all affected people were interviewed. The final report is supposedly the factual product, no one is prejudiced by anything. It’s about the misuse of public funds, what considerations should be there for thieves and maladministration?
“It is a misguided, conservative approach meant to protect people and the department from exposure to the rot. It is astounding coming from someone who is supposed socialist, covering for rent-seekers at the expense of poor working-class people,” Godi said.
Nzimande is the national chairperson of the South African Communist Party (SACP) and served as the party’s secretary general for over two decades.