The Special Investigating Unit (SIU) has called on the City of Johannesburg, SA’s richest metro, to ensure all supply chain management officials undergo training and lifestyle audits and that the metro follows strict compliance with procurement policies.
SIU CEO advocate Andy Mothibi briefed the standing committee on public accounts in parliament on Wednesday on its investigation into allegations of irregular procurement processes and awarding of tenders in the Joburg metro.
Trade, industry & competition minister Parks Tau served as the ANC mayor from 2011 to 2016. He was succeeded by ActionSA president Herman Mashaba, who served as a DA mayor from 2016. Mashaba did not finish his term as he resigned from his position and the party in 2019. He was succeeded by ANC councillor Geoff Makhubo in 2020, who died in 2021.
Some of the high-level observations from the investigation said Mothibi found there was collusion between supply chain management officials, bid committee members and service providers, among others. There was also overpricing of goods and services, with products supplied not meeting specifications.
Other observations pertained to inadequate and/or gaps in the systems and processes, weak regulatory and compliance monitoring, inadequate skills and capacity, poor oversight from the executive authority and conflict of interest. There was poor accountability and no consequence management; leadership instability and poor management; no segregation of duties; and poor project and contract management.
The SIU investigation looked into the procurement of or contracting for vehicles and vehicle maintenance services from Fire Raiders; repairs and maintenance work at fire stations; closed-circuit television equipment and related services from SOS Protecsure; office accommodation and furniture for the integrated operations centre; and procurement of motorcyclist uniforms for the Johannesburg Metropolitan Police Department (JMPD).
The SIU concluded the tender process to appoint Fire Raiders for the purchase of 29 fire engines valued at millions of rand was irregular.
Mothibi said the combined total amount in respect of installing CCTVs at Joburg’s Emergency Management Services and JMPD was R10,632,030.20. The investigation revealed that service providers submitted duplicate invoices to the metro “and all these invoices were paid”.
“The total amount that needs to be claimed from SP [service provider] is duplicate invoices to the value of R599,236.46,” Mothibi said. There were no adverse findings against the integrated operations centre contract or the tender for motorcyclist uniforms for the JMPD.
Mothibi said the National Prosecuting Authority had referred 12 fraud cases that are now under investigation. A total of 11 officials were referred to accounting officers/authorities to institute disciplinary action.
Several requests had been made, but there was no feedback from the City of Johannesburg on the status of the referrals, the SIU head said. He called on the metro to establish a proper document management system for all supply chain management and payment documents.
The metro, SA’s economic and financial hub, also needed to establish a proper process for contract management where contracts awarded to service providers are “monitored on an ongoing basis so that non-performance and defective performance can be addressed while the contract is running”.
The local government sector continues to be dogged by instability, malfeasance and fiscal challenges that have resulted in billions of rand being wasted on fruitless, wasteful, unauthorised expenditure each year, affecting the delivery of basic services such as potable water, electricity, clinics and refuse collection.
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