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Officials to pay back VBS money


Municipal officials who made the call to invest taxpayers’ money in Venda Building Society (VBS) Mutual Bank are likely to have to pay back the money upon completion of forensic investigations by Provincial Treasury.
This follows a directive by the Executive Council (Exco) during a meeting at the Premier’s Office last Wednesday that Provincial Treasury should commence with forensic audits in order to determine whether the ten municipalities that invested public funds in VBS Mutual Bank flouted any legal provisions.
The ten municipalities are Polokwane, Makhuduthamaga, Elias Motsoaledi, Makhado, Ephraim Mogale, Collins Chabane, Vhembe District, Greater Giyani, Lepelle-Nkumpi and Fetakgomo Tubatse. When addressing journalists during the Post Exco media briefing at the Premier’s Office the following day, Provincial Government Spokesperson Phuti Seloba said if it is found that laws and regulations have been transgressed, harsh actions will be taken against the offending officials.
Seloba indicated that Premier Stan Mathabatha has emphasised that serious actions must be taken against those implicated once the forensic investigation is completed. “Out of the ten abovementioned municipalities, investments for three municipalities have matured and both the investments and interests have been paid to the municipalities, namely Polokwane, Makhuduthamaga and Elias-Motsoaledi. The remaining seven municipalities still have their invested funds with VBS Mutual Bank,” he stated.
He added that it is not acceptable for accounting officers to invest public funds in VBS Mutual Bank instead of completing or starting new projects to benefit the people of Limpopo. Seloba warned that harsh actions will be taken because this is a serious issue and responsible officials will have to pay back the money.
He gave an example with Collin Chabane Municipality saying: “Officials in this municipality have invested all the powers in the municipal manager, so the manager does as she pleases without even consulting with the municipal mayor when taking decisions. There is no reasoning that can convince the Provincial Government on this lousy decision to invest millions of Rands in a building society.”
Some of the municipalities are at the stage of collapse due to this investment, he said, adding that Limpopo citizens will hear loud screams of responsible officials once the forensic investigations are done.
The Chairperson of the Standing Committee on Public Accounts (Scopa), Snowy Kennedy-Monyemoratho said the municipalities that invested in VBS recently appeared before the Department of Cooperative Governance, Human Settlements and Traditional Affairs (Coghsta) committee which she chaired and she was shocked when mayors of Greater Giyani and Collins Chabane Municipalities denied knowledge of the investments. She said the mayors claim that municipal managers took the decisions on their own and reiterated that both the mayors and municipal managers must be held accountable. “This is a gross negligence hence heads must roll. Scopa will meet with Coghsta and Provincial Treasury to explain how this happened because there is no way such huge investments can go unnoticed.”