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Finance head sacked over R50m IT contract

Staff Writer
By Staff Writer, ITWeb
Johannesburg, 05 May 2015

Head of the Gauteng Department of Finance (GDF), Stuart Lumka, has been dismissed for financial misconduct relating to a R50 million IT contract.

The Gauteng Provincial Government announced Lumka's dismissal in a statement sent out today, outlining the findings of an independent disciplinary hearing tasked with investigating Lumka over the authorisation of payments to Shimo IT Solutions.

"On 30 April [Gauteng] premier David Makhura informed Mr Lumka of government's decision to terminate his services after an independent disciplinary hearing found him guilty of gross financial misconduct and recommended his dismissal.

"Mr Lumka was placed on special leave in May 2014 following an Ernst & Young investigation of allegations of financial impropriety."

The provincial government says it did not have a contract with Shimo IT Solutions, and therefore "no financial obligations".

Lumka has been charged with paying R48.8 million to Shimo IT Solutions "when the GDF had no legal obligation to do so". He has also been charged with acknowledging liability in favour of Novell Ireland Software Limited and Shimo when he was not authorised to do so.

Finally, the finance was charged with causing the GDF to incur irregular expenditure of R2.1 million when he signed the Shimo Project charter. "Shimo was not procured in a fair, equitable, transparent, competitive and cost-effect manner and through an open tender process," says provincial government.

The chairman of the disciplinary tribunal said the only appropriate sanction was dismissal as he had abused his position of trust.

The chairman rejected Lumka's representation that he had exercised "poor judgment" and said the finance head was unrepentant about his conduct during the course of the hearing.

"The province has also requested the State Attorney to advise regarding whether to institute criminal and/or a civil case against Mr Lumka to recover monies misappropriated. The province is awaiting the outcome of the opinion from the State Attorney."

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