Integritron Integrated Solutions’ bid to retain its controversial multimillion-rand contract with the Correctional Services Department has hit a brick wall.
In a recent ruling, the High Court in Pretoria dismissed the company’s application to challenge the government’s decision to cancel the contract.
In 2015 the Correctional Services Department signed a contract for R378m with Integritron to supply and maintain an inmate management system. But the Treasury later ordered the deal to be cancelled, saying the fact that only one supplier had met the functionality requirement meant the other bids were not considered.
This made it difficult to establish whether the R378m quote was reasonable and competitive. Furthermore, the department had failed to consult the State Information Technology Agency (Sita) in line with the requirement for state IT-related tenders under the Sita Act.
Integritron then approached the courts to challenge the Treasury directive.
The government’s then chief procurement officer, Kenneth Brown, told Parliament in 2016 that an assessment showed the tender should have been awarded for about R50m.
The applicants included South African Security Solutions & Technology, SA Fence&Gate, Tavahara trading, Xtreme Intelligence Systems and Integritron. They are part of the Sasstec group. Integritron and SA Fence&Gate have contracts with Correctional Services amounting to about R2bn.
The respondents included the finance minister and the minister of justice and correctional services.
The application was brought in terms of the Promotion of Administrative Justice Act as well as the principle of legality.
The applicants sought to challenge, among others, the two reports by the Treasury on the matter, the instruction by the finance minister to the Department of Correctional Services to cancel the contract, and to restrict the company from doing business with the government.
The minister of finance and the office of the chief procurement officer had opposed the court application.
The applicants argued that the actions of the finance minister were not procedurally fair and should be set aside on this basis alone, alternatively that the action be reviewed and set aside on the basis that it was arbitrary and irrational and in conflict with the principle of legality.
The respondents denied that the letter was an instruction letter, and contended that neither the letter nor the report upon which it was based could be said to constitute administrative action as defined in the act.
In its ruling in May, the High Court in Pretoria said the actions of the finance minister and the chief procurement officer constituted a decision within the definition of the act.
The issue was whether the decisions adversely affect the rights of the applicants and had a direct, external legal effect, the court said. It found this would not be the case.
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