A view of the mall under construction that collapsed in Tongaat, KwaZulu-Natal, last week. Picture: REUTERS
A view of the mall under construction that collapsed in Tongaat, KwaZulu-Natal, last week. Picture: REUTERS

THE state’s low-cost housing agency, the Social Housing Regulatory Authority (SHRA), has been drawn into an irregular double payment for social housing projects in Phoenix, KwaZulu-Natal, involving Shireen Annamalay, the wife of politically connected businessman Jay Singh.

Mr Singh and his family came under the spotlight last week when a mall they had been building in Tongaat, KwaZulu-Natal, collapsed, leaving at least two people dead and injuring 29. Mr Singh has secured a number of housing tenders with the eThekwini municipality.

Phoenix is about 20km south of Tongaat. The four social housing projects linked to the SHRA are Foresthaven, Longcroft, Eastbury and Stanmore — collectively known as Moko Rental Village.

Ms Annamalay is a former business associate of President Jacob Zuma’s wife, Nompumelelo Ntuli.

Business Day is in possession of documents indicating that the SHRA, an entity of the Department of Human Settlements, paid twice for the same units, first using a restructuring capital grant and institutional subsidy of R235m, and secondly R100m.

Ms Annamalay’s company, Woodglaze, a private property developer, was awarded a tender to develop units by the eThekwini metro.

However, there were no funds made available for development of units by eThekwini to Woodglaze, and only land was made available for the development.

To receive social funding, Woodglaze registered Moko Rental Village Housing as a section 21 company, which has to comply with social housing requirements.

A source told Business Day that Moko had not been accredited by the SHRA as a social housing institution when it first received money in 2010 from the SHRA, then called the Social Housing Foundation (SHF).

The project would also not have met the funding requirements because it is outside a restructuring zone gazetted by the minister of human settlements.

However, SHRA CEO Brian Moholo said last week that the information provided by the eThekwini municipality at the time was that the area was in a restructuring zone.

"They can fund projects outside restructuring zones if it is deemed a mega-project," Mr Moholo said.

A due diligence report meant to regularise the Moko project was commissioned in February last year by the SHRA. The funds had already been paid to Moko in 2011, just more than R235m for about 1,244 units.

The due diligence report placed the value of the properties at R200m. This meant the SHRA paid an excess of R34m for the units. Mr Moholo said last week that under the SHF, "the assessment criteria normally used were complied with".

In February, the SHRA approved more than R100m for the purchase of the 1,244 units by First Metro from Moko. A "confidential" report that Mr Moholo received from the SHRA’s internal auditors and sent to the agency’s audit chairman in July this year concluded that the agency had paid twice for the same units.

Treasury director-general Lungisa Fuzile said last week he was "aware of the allegations and there is an investigation in progress".