Constitutional Court
By Mpho Moloi – The Constitutional Court has dismissed an appeal by Mphaphuli Consulting, upholding the legitimacy of the Special Investigating Unit (SIU) investigation into the controversial Operation Mabone project. This judgment, handed down on 3 June 2024, marks a significant victory for the anti-corruption efforts in South Africa.
Background on Operation Mabone
In 2013, the Greater Tubatse Local Municipality (now known as Fetakgomo Tubatse Municipality) signed a contract with Mphaphuli Consulting to electrify over 13,000 homes at a cost of R168.8 million. However, the scope was later expanded to 19,000 homes, driving the project’s cost to an eye-watering R326 million.
A subsequent SIU investigation revealed that Mphaphuli Consulting, owned by Lufuno Mphaphuli, allegedly overcharged the municipality by R73 million due to cost hikes following contract amendments.
Constitutional Court’s Ruling
The Constitutional Court concluded that Mphaphuli Consulting’s application for leave to appeal did not engage its jurisdiction. The judgment detailed, “The application for condonation and application for leave to appeal have been considered and the leave to appeal must be refused with costs; hence, the Court will not delve into the condonation issue.”
The SIU expressed its relief at the court’s decision. “The judgment affirms our authority to investigate the electrification of villages under the Greater Tubatse Municipality,” the SIU stated. “It also paves the way for our civil claim against Mphaphuli Consulting to recover approximately R76 million in taxpayer money misused during the project.”
Details of the Alleged Overcharging
The investigation unearthed that the Tubatse Municipality had adopted an existing contract between Mphaphuli Consulting and Vhembe District Municipality. However, the contract terms were altered, inflating the service charges by more than R5,000 per house, resulting in the R76 million overpayment.
In response, Mphaphuli Consulting sought to challenge the SIU report through legal avenues. Their efforts were thwarted in multiple courts—first by the Limpopo High Court in March 2022 and then by the Supreme Court of Appeal in August 2023. Both courts dismissed the applications with costs.
Future Legal Actions
With the Constitutional Court’s dismissal, the SIU announced its plans to recover the legal fees from Mphaphuli Consulting. “We will be seeking the legal fees incurred during these court proceedings and related legal processes,” the SIU noted.
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