Cell C’s R500 million Usaasa broadband rollout proposal investigated

A forensic report by Gobodo highlighted potential issues with a proposal for a 100% Cell C subsidy for a broadband network rollout in Emalahleni from the Universal Service and Access Agency of South Africa (Usaasa).

Business Times reported that former Department of Communications employee Mothibi Ramusi (now Cell C’s regulatory head) made the proposal.

The newspaper reported that Usaasa CEO Zami Nkosi wanted to push through the Cell C proposal without following the legally required bidding process.

Cell C said that they acted within the terms of the Electronic Communications Act, and that it will assist with any investigation.

The Ministry of Communications said on 15 July 2013 that it has decided to ask independent investigators to look into the allegations of possible corruption and maladministration at Usaasa.

In a press statement on the Usaasa website, dated June 19 2013, the agency’s board of directors said it had resolved to act on allegations of corruption and maladministration contained in a United Democratic Movement open letter to President Jacob Zuma.

It decided to “instruct the independent audit and risk committee to institute an independent investigation into all allegations contained in the letter”.

In the letter, UDM leader Bantu Holomisa claimed that former Communications Minister Dina Pule and other senior department officials had approved a multi-million rand application by Cell C for the roll-out of broadband infrastructure in the Emalahleni local municipality.

Holomisa alleged the application was approved despite not being subjected to the normal adjudication process as required by Electronic Communications Act.

He said that had it not been for the refusal of Usaasa executive Mmatlou Morudu to implement the project, the money would have been released.

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Cell C’s R500 million Usaasa broadband rollout proposal investigated