Water meters controversy a chronological breakdown

KNYSNA NEWS - Knysna Municipality's response to queries as to when its forensic investigation into a R41-million contract with a supplier of pre-paid water meters would be concluded and submitted to Council, was that the matter was ''still under investigation''.

In a national press conference this week, Knysna Municipal Manager Dawid Adonis said the forensic investigation into the procurement of water meters is in its final stages. "Once we have received the final reports it will be submitted to Council," he said.

Responding to questions as to why the process has taken nearly 18 months instead of the initially allotted 30 days, Adonis said that the same complaint was levelled at the Provincial Government in June 2020 and they are conducting a parallel investigation into the matter.

He added that the installation of the water meters takes place in phases. "The current phase rolled out during April in Knysna this year and will see another 2 000 meters installed by the end of the calendar year. Upon completion, 10 000 new units will have been installed throughout all wards of the greater Knysna municipal area over a three-year period."

The issue came to light again after footage of piles of unused water meters stored in the open air on an open lot near the reverse osmosis plant was broadcast on the SABC last week.

The footage was submitted by an SABC news crew visiting Knysna to record a two-day pre-election visit by former DA head Mmusi Maimane as part of a news feature on the Knysna and Bitou municipalities.

The water meters have been a bone of contention for some years. The Auditor-General had identified R93 761 859 (which included some R41-million for the prepaid water meter contract) as irregular expenditure pertaining to so-called "piggy-back" contracts in the 2018/19 financial year.

Piggy-back contracts deviate from the competitive bidding process and merely rely on a tender process passed by another municipality. Municipal regulations determine that any case of irregular expenditure must be brought before the Municipal Public Accounts Committee (MPAC) for investigation.

First stirrings

On 5 February 2020 the then municipal manager, Dr Sitembele Vatala, sent a notice of intention to institute disciplinary action against the chief financial officer, Mbulelo Memani, regarding the water meters contract. Paragraph "s" of the notice stated that no prior approval was obtained for payment of R11-million to Sakhikaya Suppliers and that the technical services department was not aware of the request for payment. Vatala was suspended in February 2020 and on 28 March 2020, Council resolved that the disciplinary board must investigate the allegations against Memani.

On 26 May 2020, the municipal disciplinary board submitted its report to the then acting municipal manager, Dr Michele Gratz, recommending to the council that the complaints concerning the Sakihakya contract and Memani were founded and worthy of a full investigation.

It advised that a forensic investigator be appointed to investigate the contract and Memani's conduct in relation to it and report back to the mayor within 30 days. But two days later, on 28 May 2020, Gratz recommended to Council to write off the irregular expenditure of over R93-million, of which R41-million related to the prepaid water meters contract.

At the time, not yet aware that the disciplinary board had recommended a forensic investigation into the water meters contract, Council resolved to write off the expenditure.

Forensic investigation

On 11 June 2020, after the report from the disciplinary board was presented on the agenda, Knysna Council resolved that a forensic investigator be appointed to scrutinise allegations against the CFO regarding the water meters and report back to the mayor within 30 days of his appointment (this has still not occurred nearly 18 months later). The decision to write off the R93-million remained in place.

Citing the Auditor General's recommendation and the fact that neither had the forensic investigation been concluded nor had the matter been referred to the MPAC, the Knysna Ratepayers Association (KRA) requested that Council rescind its decision to write off the irregular expenditure of R93-million on 16 August last year.

On 27 August 2020, Council set aside its decision and referred the irregular expenditure to the MPAC for an investigation. At the time, DA councillors Tyokolo and Michelle Wasserman described the MPAC investigation as a mere "box-ticking exercise".

Numerous water meter covers can be found at a site off Marlin Road.

Lack of cooperation

The KRA, however, announced that it was confident that the MPAC chair at the time, Ian Uys, would conduct a thorough investigation into the matter. Uys resigned in early October citing lack of cooperation and obstruction into the investigation over some months as a reason.

"After I was appointed, the DA, who had held the position previously, didn't cooperate with our committee at all. Despite my telephone calls, in which I requested cooperation, despite political differences, none was forthcoming," he stated in his resignation letter.

Former DA Councillor Michelle Wasserman was appointed as the new chairperson of the MPAC and within days concluded the investigation. Without any notice to the public, on 20 October 2020, the MPAC, then headed by Wasserman, recommended that the entire R93-million be written off, as the municipality had received value and had suffered no loss.

R93M written off

The KRA opposed the recommendation to write off the irregular expenditure before the forensic investigation had been concluded - but on 29 October 2020, Council accepted the recommendation from the MPAC and wrote off the irregular expenditure, despite the fact that an investigation into the water meters contract was still pending.

The DA and ANC unanimously supported the illegal write-off of the R93-million.

Despite the Knysna Council's resolve that a forensic investigator must be appointed to scrutinise allegations against the CFO in connection with the water meters and report back to the mayor within 30 days of his appointment, no forensic investigator had been appointed by 29 March this year, some nine months later.

On 19 May, Acting Municipal Manager Dawid Adonis told the KRA that an investigator had been appointed, and on 6 October he stated that a draft report had been completed and a final report would be submitted to Council - almost 18 months after Council's resolution to report on the matter within 30 days.

During this week's press conference, Adonis said the approximately 142 meters that were found to be defective were replaced by the supplier at no cost to the municipality.

He said the installation of these sophisticated water management devices is an important aspect of the municipality's water and revenue management strategies.

"The meters have numerous advantages - they prevent excessive water service charges by detecting leaks and provide consumers with the power to decide how much a household spends on water in any given month.

"They also allow us to maintain an accurate bearing on water usage and availability, and ensure that water services are paid for fairly and equally."

Numerous water meter covers can be found at a site off Marlin Road.