Johannesburg - The Auditor General (AG) lifted the lid on Tuesday on allegations of irregular expenditure and awarding of tenders totalling over R1 billion by the Gauteng Department of Roads and Transport.
The investigation of 13 tenders awarded by the department since last year followed a request made to the AG's office by Transport MEC Ismail Vadi that it probes whether or not the decision taken in respect of the tenders were in line with the legal prescripts of government. On Tuesday Vadi briefed the Portfolio Committee on the report following six months of investigation.
The tenders included a R900 million contract for the construction of roads over a period of three years, R49 million for the provision of security to the department's building and R35 million for the establishment of new driver's licence testing centres.
Amongst its findings, the AG's report points to a systematic weakness in the department's supply chain management process and poor quality of reporting. The report found that the process followed when awarding the contracts was flawed and suggested that actions by some officials may have amounted of a conflict of interest.
Bidders were not sufficiently rated and no evaluation of different bidders took place leading to incorrect ranking and higher value contracts. Vadi said as a result the process having been flawed, the five successful bidders for the security tender were awarded contracts while they should have been disqualified at the preliminary evaluation stage. "As a result these bidders received contracts to which they were not entitled to," Vadi said.
He confirmed that as a result of the investigation, none of the contracts had been signed with the service providers with the possibility of reopening the tender process.
With regards to the roads construction contract, the AG's report reveals that the department prepared and issued letters of appointment to the three service providers even though no funds were available. "The department did not know how much the entire road construction project was going to cost as there were no bills of quantities," said Vadi.
"The Head of Department also did not ensure that proper procurement processes were followed as she failed to wait for the approval of the MEC for Finance...the HOD proceeded with the appointment even after she was instructed by provincial treasury not to do so."
No officials have been suspended. Both the Democratic Alliance and ANC in the Gauteng Legislature said the findings of the report pointed to an "abuse of power by officials" and called on an immediate action against those involved.
"We urged the department to be harsh against those who are implicated. It must be a lesson to even those who think of doing the same thing," said the DA Chief Whip Glenda Steyn.
Vadi further said the findings highlighted the importance of departmental leadership in creating the "correct environment in the organization".
"As noted in the report it includes the manner in which leadership monitors performance and compliance and the way in which ethical behaviour is promoted," he said.
