Report exposes extent of dodgy state tenders
May 6, 2009
By Donwald Pressly
Companies with links to government officials pocketed business worth nearly R600 million from the state in the past four years, the auditor-general has reported.
The report says government employees at national and provincial departments were either directors, or had relatives with direct interests, in firms that secured state contracts.
Auditor-General Terence Nombembe stated in a report to Parliament that of the 49 employed in national departments, 46 had not received the required approval "to perform other remunerative work" as required by legislation.
He reported that during the auditing period under review - August 2007 to July last year - the total paid by national departments to these companies was almost R36m.
The problem is far more acute at provincial level. In the auditing period from April 2005 to January 2007, business with companies linked to staff at provincial level was worth more than R540m. Nearly 2 300 provincial staff were involved.
In the 2005/06 financial year, two companies linked to two state officials did business with the Department of Education worth R30m. The next largest was more than R1m paid to four companies with links to four officials at the Department of Correctional Services.
Departments with no reported incidents were those of the presidency, home affairs, public works, the treasury, public enterprises, public service and administration and the Public Service Commission.
As well as the police and Statisitics SA, other guilty departments are labour, agriculture, housing, water and forestry.
Public Services Commissioner Stan Sangweni said the fact that staff had obtained contracts from their own departments "should be regarded as an actual conflict of interest".
The Public Service Act says state employees who received remuneration and rewards outside the state should pay the money into the revenue account.
Breakdown for April 2005 to January 2007
Western Cape: 65 officials in deals worth R57 million.
North West: 149 officials in deals worth nearly R30m.
Eastern Cape: 230 officials in deals worth R26m.
Free State: 116 officials in deals worth R14m.
Limpopo: 929 officials in deals worth R270m.
Northern Cape: 29 officials in deals worth R4.3m.
Gauteng: 179 officials in deals worth R24.8m.
Mpumalanga 573 officials in deals worth R115m.
Source: Auditor-general’s report
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