I have this morning written to the Public Protector, following our disclosure yesterday (see here) that a seven month, R13.3-million independent financial audit had uncovered a number of serious irregularities in the management of the Road Traffic Management Corporation (RTMC).

A copy of that letter follows below.

1 February 2010

The Public Protector

Hillcrest Office Park,

174 Lynnwood Road,

Hatfield,

PRETORIA

Dear Adv Madonsela

RE: Request for investigation of the CEO of the Road Traffic Management Corporation (RTMC)

I write to you in my capacity as the Democratic Alliance (DA) national spokesperson on transport, and would like to request that the Public Protector conducts a formal investigation into the conduct of the Chief Executive Officer (CEO) of the Road Traffic Management Corporation (RTMC), Mr. Ranthoko Rakgoale, along with other senior officials of the RTMC, who have been implicated in serious instances of misappropriation, procurement irregularities and gross financial mismanagement.

Yesterday, on Sunday 31 January 2009, my party released publicly an independent audit carried out by Deloitte and Touche, which we believe confirms beyond doubt that an investigation into the RTMC is urgently required, and we believe that the Public Protector would be an appropriate body to carry out such a probe.

We must make it very clear that the Democratic Alliance has attempted on numerous occasions to resolve this matter by approaching the relevant public office bearers. The allegations against Mr. Rakgoale first came to light in a Sunday Times article on the 7 July 2009. The DA has subsequently written to the Minister of Transport, Sbu Ndebele, on three separate occasions, requesting a full investigation, the release of details of the action being taken by the Department of Transport, and also asking that Mr. Rakgoale be suspended pending the investigation. No reply was received from the minister on any of these occasions. The DA then raised the issue in a Portfolio Committee on Transport meeting and the Chairperson agreed to liaise with the Minister in this regard. However, this step also proved to be a dead end. I then submitted a series of parliamentary questions to the Minister with the hope of obtaining clarification on the matter. Again, I believe Parliament is yet to be satisfied that the Department of Transport has taken any of the actions necessary to investigate this very concerning state of affairs.

In October 2009, the DA was leaked documents from a number of whistleblowers at the RTMC that suggested that the mismanagement and fraud allegations against the Mr. Rakgoale were well founded. This matter was brought to the attention Minister Ndebele; once again, the Minister did nothing.

The DA has now obtained a copy of a seven month, R13.3-million independent financial audit of the Road Traffic Management Corporation (RTMC) carried out by Deloitte and Touche. The confidential financial audit was completed in September 2009, and provides yet further concrete evidence that CEO, needs to be investigated.

The Deloitte and Touche report implicates Mr. Rakgoale in approving salary increases in excess of approved limits, it reveals a serious lack of monitoring of controls over the RTMC's budget and a lack of evidence to suggest that payments were made in conjunction with the RTMC budget", it discloses that serious mismanagement of the database of traffic violations has occurred, and it reveals a lack of adherence to the Public Finance Management Act (PFMA) with regard to procurement procedures.

Although the report does not elaborate on which specific payments were made outside the RTMC's budget, it certainly provides further substantiation for the set of allegations which have surfaced in the past by whistleblowers at the RTMC against the CEO. These allegations include:

• Spending R4.5-million on provincial workshops, when only R1.5-million had been budgeted for the purpose
• Entering into a 10-year R658-million lease for nine office blocks, only two of which are currently being used for a staff component of 144
• Blowing R1.3-million of RTMC funds for the hire of private suites at Ellis Park and Loftus Versfeld during the Confederations Cup
• The purchase by the CEO of a Audi A4 for personal use, using RTMC funds, despite receiving a hefty car allowance.

Although the carrying out of this financial audit resulted in a review of the RTMC's systems, it did not result in any action being taken against the individuals concerned, or any reversal of the actions they took. Right now there is no evidence that the matter is being resolved, or that the Department is taking any kind of disciplinary action. This creates the impression that the Department is not interested in tackling serious indiscretions within its own department.

As your office is charged investigating "matters such as maladministration in connection with the affairs of the government, improper or unlawful enrichment of a person performing a public function, improper act[s] with respect to public money, [and] improper or unlawful enrichment of a person performing a public function...", we believe that the Public Protector can play a valuable role in helping to rectify the state of affairs at the RTMC, and ought to conduct an investigation into this matter.

For too long, public servants have continued to plunder public funds without much reprimand from state or institutions established by Chapter 9 of the Constitution. It is imperative that the Public Protector, restores public confidence in the ability of these institutions of act without fear, favour or prejudice. The seriousness of the present matter cannot be ignored, and therefore requires your urgent attention.

I have enclosed copies of the documentation that will be prove to be of assistance in your investigation, including the audit carried out by Deloitte and Touche. Please do not hesitate to contact me should you require further information or documentation pertaining to this matter.

Sincerely,

Stuart Farrow MP

DA Spokesperson on Transport

Statement issued by Stuart Farrow, MP, Democratic Alliance shadow minister of transport, February 1 2010

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