Textbook supplier loses bid to carry onComment on this story
While political parties and NGOs are calling for a probe into the relationship between the Limpopo Education Department and EduSolutions, this company, which was awarded the R500 million to R700m tender to supply textbooks to pupils, has made an unsuccessful application for it to remain the supplier of education material in the province.
The multimillion tender was cancelled in April this year, but EduSolutions, in an urgent application before the Pretoria High Court, has asked that this cancellation be declared unlawful and of no force.
It asked Judge Hans Fabricius to order that the contract be considered to be still valid and that the administrator of the Limpopo Department of Education and the Minister of Basic Education, Angie Motshekga, be interdicted from procuring the learning material from any party other than the applicant.
EduSolutions also said it was entitled to have all outstanding money, which it said amounted to millions, paid to it.
This application comes in the midst of the Limpopo textbook scandal, with thousands of pupils in this province not having received any textbooks six months into the year. This is in spite of a court earlier imposing a delivery deadline of June 15.
Both the opposition party and ANC MP Hope Malgas have called for an investigation into the relationship between the education department and EduSolutions. Various NGOs, including the Centre for Child Law, are calling for an urgent meeting with all the stakeholders to try to resolve the crisis.
Forensic auditors are, according to court papers, also in the process of investigating the award of the tender to EduSolutions, and the judge was told that, following preliminary findings which were made, the matter had been referred to the police, who were investigating it.
EduSolutions was awarded the tender in 2010 to deliver school books to Limpopo for three years. This contract was cancelled on April 26 this year and EduSolutions said it was never told exactly why, except that the award of the tender at the time had been irregular.
This company said the tender was worth R900m over three years and that the department should have asked the court to resolve the matter rather than cancel the contract.
The Education Department told the court that after the national government took over the administration of the Limpopo Province, the then administrator, Anis Karodia, found that there was misappropriation of about R2.6 billion and an inability to provide educational services and textbooks to schools, as well as a “massive mismanagement” of funds.
He wrote a letter to EduSolutions in April this year, notifying it that the tender and subsequent service level agreement was invalid as it did not comply with the legal requirements and that it was being cancelled with immediate effect. It was explained that the initial budget for the tender was R253 903 455 for last year, but this had to be increased to R321 146 470 to meet the orders placed by EduSolutions.
In spite of complaints by the acting chief financial officer at the time that the contract should not be concluded with EduSolutions as it would lead to “wasteful expenditure”, the then head of the department fired the financial officer and insisted that the tender award should go ahead. A payment of R19.4m to EduSolutions was authorised within a month of the conclusion of the agreement.
Two tenders were meanwhile advertised for the supply of toys for Grade R pupils as well as calculators. These tenders were cancelled and these orders were instead placed with EduSolutions.
The judge was told that investigations revealed that EduSolutions received a discount for the toys and the company claimed 70 percent thereof as its share, amounting to R6.2m. It was also found that although the company acquired the calculators at a reduced price, the Limpopo Education Department paid it R446 922 over and above the actual acquisition price.
The judge was told that there was thus sufficient evidence to suspect untoward conduct in the awarding of the tender to the company.
Judge Fabricius found that the company had not made out a case and that it had alternative remedies if it felt aggrieved.