Pretoria - The awarding of multimillion rand tenders by many municipalities across the country during the Covid-19 pandemic state of disaster failed to comply with supply chain management regulations.
The Special Investigating Unit (SIU) report released to the public by the Presidency on Tuesday detailed how contracts, including the ones for feeding the homeless, were irregularly awarded by different municipalities.
Among them was the City of Tshwane, found to have flouted supply chain management processes by appointing service providers for a R24 million catering tender to feed the homeless, accommodated at the seven shelters set up during hard Covid-19 lockdowns.
As a result of such a transgression, the SIU recommended that disciplinary action be instituted against division head of supply chain management, Thembeka Mphefu.
The report said: “The mentioned official has acted wrongly in that she committed gross and serious misconduct, which prejudiced the administration, discipline or efficiency of the City of Tshwane Metropolitan Municipality.”
Mphefu, the report said, allowed an emergency procurement process to unfold knowing very well that such a process had to include the requirements of fairness, transparency and competition to appoint the service providers.
Also taken to task for the flawed tender was group head of Gauteng Community and Social Development Services, Tich Mekhoe, who it was recommended that he face disciplinary action.
“The official committed gross and serious misconduct, which prejudiced the administration, discipline or efficiency of the Tshwane when he allowed an emergency procurement process to unfold knowing very well that such a process had to include the requirements of fairness, transparency and competition to appoint the service providers,” the report said.
During the SIU investigation, it was discovered that no purchase orders were issued for the rendering of the services. The service providers were in possession of the appointment letters by the metro.
At the time of the probe, no payments had been made and the SIU advised the City to stop any payments which could potentially be irregular.
On the other hand, the City of Joburg faced allegations where 25 entities were awarded contracts valued at R18 million without following the procurement process prescribed by the MFMA during lockdown.
However, upon investigation the SIU revealed that only one of the 25 service providers was appointed without following an SCM process. The value of the implicated contract was R14 300.
The Nelson Mandela Bay Metro was investigated for allegations related to the infrastructure projects implemented to assist the municipality to curb the spread of the pandemic during the Covid-19 disaster period.
The municipality awarded a R24 600 000 tender to a company known as HT Paletona Projects (Pty) Ltd, to construct 2 000 erven of toilets, stand pipes and 2 000 aerators for informal settlements.
“The SIU investigation has established that the memorandum motivating for the appointment of Paletona resulted in the appointment of the latter on April 17, 2020. It has also been found that Paletona was appointed before the award letter which was only issued on April 28, 2020,” the report said.
The SIU issued a letter to the metro to stop paying Paletona, but the company approached the High Court to force the municipality to pay the money owed to it.
“The SIU applied to join the proceedings to oppose the application. The matter was heard on August 19, 2021 and judgment was reserved,” the report said.
It was established that some of the items procured by eThekwini municipality were not part of the National Treasury rated list of products, and resulted in eThekwini using market related pricing for these items.
The SIU found that the City rejected the offer by NGOs to cater for volunteers and staff. However, the metro subsequently awarded contracts to service providers to cater for the volunteers and staff.
The City’s head of supply chain management, Andre Petersen could not provide the SIU with any documentation supporting the catering for volunteers and staff.
“In the absence of the documents requested, the entire process is flawed. The approved deviation provided solely for the catering for homeless people,” the report said.
Some companies were found to have charged eThekwini for invalid structural certificates for marquee used during the stricter Covid-19 period and overcharging on a catering contract.
The intervention by SIU at the metro saw at least R110 000 recovered so far.