As Makana Municipality struggles to quell rumours of bankruptcy and the threat of going under administration, explosive evidence has emerged of a secret deal with Municipal Manager Pravine Naidoo that will cost it millions.
As Makana Municipality struggles to quell rumours of bankruptcy and the threat of going under administration, explosive evidence has emerged of a secret deal with Municipal Manager Pravine Naidoo that will cost it millions.
Documents that Grocott's Mail has in its possession indicate that Council Speaker Rachel Madinda-Isaac earlier this month agreed to pay more than R100 000 in legal costs, on top of a R3 million out-of-court settlement with Naidoo.
Strategic Manager Mncedisi Boma and labour relations officer Xolani Mbeleni appear as co-signatories to the document dated 24 July 2013.
Boma appears as the signatory to a letter dated 2 October 2013 instructing acting chief financial officer Marius Crouse to implement a labour court order and pay Naidoo R108 374.79.
"Please refer to paragraph 4 of the Order pertaining to legal costs; further refer to the attached determination of the costs in the amounts of R108 374.79 as calculated by Mark Bowles and Associates, legal costs consultants," the letter reads.
Grocott's Mail reported earlier this year that an out-of-court settlement was discussed in a confidential special council meeting ('Councillors demand the dirt on Naidoo' – Grocott's Mail, 14 June 2013).
Naidoo took the municipality to the Labour Court after his removal from office in 2007 during his previous term as municipal manager. He demanded to be reinstated or that the municipality pay him over R5 million, the equivalent of the MM’s total remuneration package calculated over five years. This was R5 100 000 at the time.
Municipal Spokesperson Mncedisi Boma said in June that Council had decided the Mayor should be given the go-ahead to assign lawyers to represent the municipality.
At the time labour relations officer Xolani Mbeleni said Council needed to give its approval for the municipality’s lawyers to begin settlement negotiations.
However, Council was not party to the decision to settle out of court with Naidoo.
In the 6 June meeting councillors refused to discuss the settlement and deferred it for more information. No decision has since been minuted as to whether Council has decided to pay Naidoo or not.
The recent document indicates an agreement by the two parties that "The applicant and the First Respondent have agreed to compromise such claim and to settle the said action on the basis that the damages suffered by the plaintiff was R3 million and in addition, to pay the applicant's legal costs from November 2007 to present date."
The labour court documents state, "The plaintiff instituted action in the Honourable court under Case number P356/08 claiming instatement, alternatively, damages in the sum of R 4 600 000 and further damages of R500 000 together with the costs of the trial."
Asked for comment, Mike Smith of the municipality's attorneys, Smith Tabata, said, "I cannot comment on it… I don't have powers to disclose information on their behalf."
Smith referred the request for comment to Mbeleni.
Contacted for comment in his role as municipal spokesperson, Boma said on Thursday afternoon, "That was a confidential item and we do not have the right to discuss it with the media. As Council we are still awaiting the outcome of the matter. It is a labour relations matter. Council's stance is that we will not express an opinion on this confidential matter between employer and employee."
