The Special Tribunal has reviewed and set aside two Independent Development Trust (IDT) contracts worth R1.6-billion. It has also ordered the five companies, which received the contracts, to pay back all profits gained from the contracts.
According to the Special Investigating Unit (SIU), the five companies were awarded the contracts by the IDT. The contracts were to implement projects at the Department of Correctional Services.
“The decision of the Special Tribunal… follows an investigation by the SIU into the affairs of the Department of Correctional Services.
Failed to follow applicable procurement procedures
“This investigation revealed that the IDT failed to follow the applicable statutory and regulatory procurement provisions governing public procurement as set out in the Constitution of the Republic of South Africa, in concluding the contracts with the companies,” the SIU said.
According to the SIU, the department had appointed the IDT as an implementing agent. It was to “manage the implementation of security fencing, parameter fencing, intercoms and conditions audits, and other infrastructure projects at various correctional centres in South Africa”.
“Following its appointment as an implementing agent, the IDT contracted Secelec Consulting Engineers (Pty) Ltd, Bakone Consulting Engineers (Pty) Ltd, and Bakone Secelec Consulting JV 2011 as transactional advisors to implement the building of fences around various prisons at a cost of R492, 960 564.66. The contract was later cancelled.
“In 2012, the IDT appointed Manyeleti Consulting SA (Pty) Ltd and SA Fence and Gate JV as transactional advisors for a similar job. The budget for the initial tender increased with R72, 454 350.62 or 15.2%.
Tender/contract award was predetermined
“However, the total budget increased to R861, 255 544.40. This escalation represents 81% of the approved budget and way above the permitted 20% deviation as per the National Treasury regulations. The Tribunal found that the tender/contract award was predetermined,” the SIU explained.
The corruption-busting unit welcomed the Special Tribunal’s ruling on the matter. It added that any criminality will be reported to the National Prosecuting Authority (NPA).
“The Special Tribunal had ordered the five companies to render the full accounts of all the payments they received. This under the contracts awarded by IDT and reasonable expenses incurred. Also supported by necessary vouchers.
Companies to pay whatever profits that were earned
“Following the calculations of expenditure to service the now illegal contracts, the companies shall pay whatever profits that were earned. Furthermore, the companies were ordered to cover the legal costs of the review application brought by the SIU.
“The SIU welcomes the decision of the Special Tribunal. It forms part of the implementation of investigation outcomes and consequence management. This to recover financial losses suffered by the state. … [The SIU] will refer any evidence pointing to criminal conduct it uncovers to the [NPA] for further action,” the SIU said.
- SAnews.gov.za
