A Special Investigating Unit (SIU) probe has found that the North West Department of Education incurred more than R6.5 million in over expenditure when procuring thousands of cloth face masks.
In a statement, the SIU said ordinarily all competitive bids above R500 000 awarded by government entities must be awarded by a bid adjudication committee (BAC) in terms of National Treasury regulations.
The BAC considers the recommendations of the Bid Evaluation Committee and, depending on the delegated powers, make a final award or a recommendation to the accounting officer to make a final award.
During its investigation, the SIU found that the department established an informal committee to manage the procurement of personal protective equipment (PPE) outside the committee as provided for in terms of Treasury regulations.
“That committee may have committed financial misconduct as it failed to ensure that the supply chain management governing public procurement process was fair, equitable, transparent, competitive and cost-effective,” said the SIU on Tuesday.
The investigation further shows that two requests for quotations (RFQ) were issued by the committee on behalf of the department for the supply and delivery of 50 000 masks per RFQ. In the first RFQ, three service providers were appointed to the value of R3.7 million.
“With the second RFQ, five service providers were appointed to the value of R5 512 million. However, the department used the two RFQs to procure 400 000 masks, 300 000 more than what was initially requested.
“The irregularity has resulted in the department having to pay more than R9.2 million for masks instead of R2.5 million. The regulated price for the face cloth mask by the National Treasury is R25.”
The SIU investigation has also revealed that one service provider was appointed despite submitting a quotation after the cut off time.
Furthermore, the committee requested that one of the service providers reduce their quotation so that it be below the threshold set by National Treasury.
“This is the second irregularity relating to PPE procurement that the SIU has uncovered in the North West Department of Education.”
The SIU has commenced with the civil litigation process to declare the contract invalid and unlawful, and to recover any financial losses suffered by the North West provincial government.
In line with SIU Act of 1996, the SIU has made a disciplinary referral against members of the informal procurement committee for flouting supply chain management processes and for exposing the department to over expenditure of more than R6.5 million in the appointment of service providers. – SAnews.gov.za