Govt pensions agency scandal: 'Irregularities involve R1.2bn of civil servant pension assets' - investigative journalist

The Money Show's Stephen Grootes is joined by Sikonathi Mantshantsha, investigative reporter at News24.

The suspension of the CEO of the Government Pensions Administration Agency (GPAA) was welcomed on Tuesday by the Portfolio Committee on Public Service and Administration.

Finance Minister Enoch Godongwana announced the precautionary suspension of Kedibone Madiehe amid serious allegations of procurement irregularities at the Agency.

RELATED: Godongwana expects full operations to continue at GPAA after CEO placed on precautionary suspension

The Minister said he expected full operations to continue at the GPAA after seconding Job Stadi Mngomezulu, the National Treasury's Deputy Director-General of Corporate Services, as Acting CEO for the Agency from this week.

The allegations against Madiehe include claims that she is aware of a fictitious lease agreement entered into by the pensions administrator and a property developer, costing more than R1 billion.

Stephen Grootes gets more detail from News24 reporter Sikonathi Mantshantsha, who has been writing stories about the scandal for the past three weeks.

Sikonathi says their ongoing investigation shows that GPAA contracts appear to be riddled with irregularities 'that really do border on fraud and corruption'.

"At risk is more than R1.2 billion of the Agency's money which really is money belonging to the pensioners and the civil servants, which are invested through the
Government Employees Pension Fund (GEPF) and the Public Investment Corporation (PIC)."

Sikonathi Mantshantsha, Investigative Journalist - News24

The biggest of the alleged procurement irregularities they've exposed concerns the lease of the office building to be used for the headquarters of the GPAA, Mantshantsha reports.

The Agency is leasing this building for a period of nineyears and 11 months from Shula Developers, which actually does not own it, he goes on.

"The owner, a company listed on the JSE, says it knows absolutely nothing about the alleged sale of the building to this company called Shula Developers, which could not produce any agreement to say it has bought the building, as far as we are concerned."

Sikonathi Mantshantsha, Investigative Journalist - News24

"The Agency has already paid R60 million for renovations and partitions inside the building, but the two companies that have been paid for that have no access to the building."

Sikonathi Mantshantsha, Investigative Journalist - News24

News24 started writing to the GPAA about a week ago to get answers to their questions, but the response was that it cannot answer these 'because there are internal processes and auditing going on which prevent them talking to us'.

To hear more about the alleged rot at the Government Pensions Administration Agency, listen to the interview audio at the top of the article