AFRICAN MIRROR REPORTER
SOUTH Africa’s Special Investigations Unit (SIU) has recommended that the law must be changed to make it illegal for politicians and their immediate families to benefit from state tenders.
The SIU has also suggested that, once the legislative changes have been made, intentional non-compliance should be a criminal offence.
The SIU is at the heart of a co-ordinated crackdown by the South African government against fraud and corruption in the billions spent on measures to fight the COVID-19 pandemic. It works with the Hawks, an elite investigations unit, the National Prosecuting Authority and the Auditor General’s office.
Investigations by the SIU have revealed among the transactions it investigated for malfeasance are several tenders awarded to politically connected people in Gauteng, Limpopo and the Eastern Cape provinces. In Gauteng. Dr Bandile Masuku was fired from his post as MEC for Health in Gauteng after family friends were awarded a tender worth R130 million.
Advocate Andy Mothibi told Parliament’s Standing Committee on Public Accounts that the legislative amendments should be considered not only for prominent influential persons but their immediate families as well as entities in which they have an interest or are beneficial owners.
“All State Institutions should be bound by such safeguards. It is not suggested that the mere fact that someone falls in this category would render the contract unlawful, but it should be a prerequisite of all supply chain management processes that a disclosure must be made that a potential service provider falls within the category set out above. Failure to make such a disclosure must be unlawful and should constitute a statutory cause of action to attack the validity of the process. Intentional non-compliance with such a prescript should be a criminal offence.”
Mothibi said the proposals were the SIU’s response to a public outcry about the involvement of domestic prominent influential persons and their immediate family benefitting from PPE procurement by state institutions.
He said currently, such involvement does not necessarily render the awarding of contracts to such people, or entities that they are involved in, unlawful and such contracts must be scrutinized for compliance with the principles of section 217(1) of the Constitution.
“The need exists for considering additional safeguards for situations where State Institutions contract with persons in these categories. FICA currently regulates the conclusion of contracts between “accountable institutions” and domestic prominent influential persons and their immediate family, but the schedule listing “accountable institutions” does not include state institutions, such as national, provincial, or municipal entities, or even state owned Entities. In addition, FICA only envisages remedial action through “administrative sanctions. FICA also does not create a statutory offence if its provisions are not complied with,” he added.
Mothibi has also revealed that of the R15.6-billion spent by the SA government on PPEs, an expenditure of R10.5-billion, representing 67% of the total budget, is under investigation.
He further disclosed that of the R10.5-billion under investigation, steps have been taken, through the SIU’s special tribunal, to set aside contracts worth R223-million and recover the losses.
He said the SIU has finalised 20 cases and referred them to the NPA, among them are five cases involving the Gauteng Health Department, where the prosecuting authority is expected to take decisions whether or not to prefer criminal charges against high ranking officials implicated in irregularities involving over R4-billion spent on PPEs.
Mothibi said the SIU had uncovered instances where personal protective equipment was overpriced, procurement rules flouted and services not delivered despite money being paid.
