Special Tribunal
By Karabo Marifi
Pretoria – The Special Tribunal has reviewed and set aside two Independent Development Trust (IDT) contracts worth approximately R1.6 billion. The Tribunal has ordered the five companies involved to return all profits gained from these contracts.
The Special Investigating Unit (SIU) revealed that the contracts were awarded by the IDT to facilitate projects for the Department of Correctional Services. “The decision of the Special Tribunal… follows an investigation by the Special Investigating Unit (SIU) into the affairs of the Department of Correctional Services,” the SIU stated.
The SIU’s investigation uncovered that the IDT had not adhered to statutory and regulatory procurement provisions as mandated by the South African Constitution when awarding the contracts. The IDT had been appointed by the Department of Correctional Services to oversee the implementation of security fencing, intercom systems, and other infrastructure projects at various correctional facilities across the country.
Initially, the IDT engaged Secelec Consulting Engineers (Pty) Ltd, Bakone Consulting Engineers (Pty) Ltd, and Bakone Secelec Consulting JV 2011 as transactional advisors to manage the construction of prison fences at a cost of R492,960,564.66. This contract was eventually cancelled. In 2012, the IDT then appointed Manyeleti Consulting SA (Pty) Ltd and SA Fence and Gate JV for similar work, but the project’s budget ballooned by R72,454,350.62 or 15.2%.
“The total budget surged to R861,255,544.40, representing an 81% increase from the approved budget and significantly exceeding the permitted 20% deviation set by National Treasury regulations. The Tribunal concluded that the tender/contract award was predetermined,” explained the SIU.
The SIU has welcomed the Special Tribunal’s ruling. “The Special Tribunal had ordered the five companies to render the full accounts of all the payments they received under the contracts awarded by IDT and reasonable expenses incurred, supported by necessary vouchers. Following the calculations of expenditure to service the now illegal contracts, the companies shall pay whatever profits that were earned. Furthermore, the companies were ordered to cover the legal costs of the review application brought by the SIU,” the unit stated.
This decision is part of the SIU’s broader strategy to implement investigation outcomes and enforce consequence management to recover financial losses incurred by the State. “The SIU welcomes the decision of the Special Tribunal, as it forms part of the implementation of investigation outcomes and consequence management to recover financial losses suffered by the State… [and] will refer any evidence pointing to criminal conduct it uncovers to the [NPA] for further action,” the SIU affirmed.
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