Editorial: Grand theft
THE Competition Commission and the Hawks have yet to complete their investigations into the construction companies accused of collusion over some R30 billion in contracts, but the market has already reacted.
It was reported at the weekend that the Hawks too are now investigating allegations that top construction executives colluded to divide the spoils from several state and other contracts, including some linked to the Cape Town Stadium.
Shares in major construction companies dropped between 3.5 and 6 percent when the JSE opened on Monday, as the market expressed a certain scepticism about executives’ denials of any wrongdoing.
The probe by the Hawks is running parallel to the Competition Commission’s investigation into 65 bid-rigging cases involving 70 or so projects. This has been in progress for more than two years and the commission has already fingered the five top JSE-listed construction companies for anti-competitive practices.
A “fast-track settlement process” launched in February 2011 is now apparently coming to a conclusion. But though the settlements may allow the affected companies to benefit from the commission’s policy of corporate leniency, this will not protect them from criminal liability if the Hawks find there is a case against them.
The sooner we are told, the better. If, as alleged, these executives have been meeting in secret to decide how to divide up state contracts so that each gets a slice, they have stolen from the public purse as surely as if they had put on balaclavas and crept into the city council’s offices at night to raid the municipal safe.
And if it turns out that the same executives who authorised the rigging of these huge contracts were handsomely rewarded by their respective boards for their revenue-enhancing performance, well, that will be yet another indication, if one were needed, of the sheer lunacy of the system within which we operate.
The big construction companies would have done very well out of the World Cup anyway. There really was no need to be greedy.