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News

Can we expect less corruption in the tender process?

While the National Treasury sifts through over 4‚000 tenders every day‚ ordinary citizens are expected to be given a better chance at receiving contracts as government attempts to make the tender process “more transparent”.

Speaking at a seminar held in Cape Town on Tuesday‚ Kenneth Brown‚ Chief Procurement Officer for the National Treasury addressed what government is doing to clamp down on tenderpreneurs – people who get rich from securing government tenders using their connections with politicians or government officials.

Brown said that the government had put measures in place to “increase visibility within the system”.

To suppress tenderprenuers‚ the Minister of Finance set up the Office of the Chief Procurement Officer (OCPO) in 2013 to modernise procurement‚ curb leakage in public expenditure and get maximum value from the R500 billion spent on goods and services annually‚ according to Brown.

“The National Treasury processes about 4‚000 tenders a day‚ so one can expect that it is often difficult to keep track of what’s going on‚” Brown said.

However‚ Brown added that while the South Africa’s eTender Publication Portal was not fully operational yet‚ it would soon be a primary source of any information related to procurement and all phases of the tender process.

According to Brown‚ the portal would save government approximately R1 billion annually. It would also be used to maintain the bidder and supplier database‚ increase qualified bidders’ competition for unique projects and ensure diversity among suppliers.

“Close to 95% of officials in government are hardworking officials who want the system to work and we are continuously working towards filtering out corruption‚” Brown added.

Carlene van der Westhuizen‚ author of Monitoring Public Procurement in South Africa: A Reference Guide for Civil Society Organisations‚ as well as Karabo Rajuili from the Amabhungane Centre for Investigative Journalism highlighted some of the flaws within the portal system.

“When public procurement is not working as it should‚ service delivery is compromised‚ resulting in goods and services that are of poor quality‚ delivered late or not delivered at all‚” said Van der Westhuizen.

Some of the issues identified by van der Westhuizen in relation to the portal:

  • “There are no clearly defined avenues to report corruption.”
  • “The biggest challenge at the moment is access to information; one cannot participate in the process without information.”
  • “It is understood that the portal is not fully functional‚ however‚ while some departments might have tenders on their own websites‚ they do not always appear on the portal.”
  • “For many tenders‚ while there was some information on the portal‚ tender application documents could not be downloaded. Tenders therefore still have to physically collect these documents and purchase them.”
  • “In most cases‚ the winning bidder’s (tenderer) information is not made available on the portal.”
  • “There is very little space for ‘ordinary citizens’ to track the tender process.”

In addition‚ Rajuili said that from a journalistic perspective‚ “the supply chain management process is highly opaque”.

“In a public procurement process‚ available information is essential and information needs to be given throughout the supply chain management process.

“We are not just interested who the bidders are‚ but rather who the owners of those companies are. Transparency in company ownership is vital to anti-corruption efforts‚” Rajuili said.

Some of the major tenderpreneurs referenced in South Africa over the years include Julius Malema. A Sunday Times exposé blew the lid on his links to companies that scored from municipal deals in Limpopo.

In 2012‚ The Times reported that from the audit that Malema and his business associate Lesiba Gwangwa milked Limpopo’s R4.6-billion roads budget through tenders awarded to their cronies through their company‚ On-Point Engineers.

His rags-to-riches story began when the Limpopo government‚ headed by Malema’s friend‚ premier Cassel Mathale‚ awarded On-Point a R52-million deal to manage its R4.6-billion roads budget in September 2009. In 2011‚ controversial billionaire Roux Shabangu spoke exclusively to Sunday Times about his political connections and how he went from being a “mealie meal salesman to one of the country’s youngest property moguls”.

David Mabilu‚ a wealthy property developer made his riches off construction tenders such as low-cost housing‚ schools and hospitals with various municipalities in Limpopo and Gauteng. In October 2011‚ The Times reported that one of his companies accumulated at least R3-billion in contracts and tenders.