South Africa public works buyers blocked after improper contracts

10 November 2011

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10 November 2011 | Angeline Albert  

South Africa’s public works minister has blocked procurement staff in his department from approving contracts for property leases.

The decision has been taken after improper tendering of R3 billion (£248 million) was uncovered at the department by the Special Investigating Unit. That discovered more than 40 cases where building lease tenders were awarded improperly. The purchasing function was found to have failed to follow procurement procedures and has subsequently been stripped of its power to arrange leases.

Following the problems, minister Thulas Nxesi this week asked the Department of Public Works' acting director-general Mandla Mabuza to stop the department’s buyers signing and approving leases for office and residential accommodation.

Nxexi has also centralised lease procurement approval and made Mabuza the only person allowed to give final consent for such a contract to be processed. A Bid Adjudication Committee at the DPW will then adjudicate the purchase of leases. The same process will apply to executives such as political leaders, commissioners and chief justices. And the procurement for all acquisitions of moveable assets, such as furniture for executives must be agreed in the same manner. The only exception is that the department’s regional offices are allowed to conclude leases relating to annual contracts for residential accommodation.

Nxesi took over from his predecessor, Gwen Mahlangu-Nkabinde, two weeks ago and promised to clean up the department. Mahlangu-Nkabinde lost her job following the investigation and a cabinet reshuffle.

In a statement, the minister said his actions have in part been “prompted by the public outcry around procurement of office accommodation and other moveable assets for client departments”.          

A task team of property management experts is being established to ensure the smooth running of the change of arrangements.

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GPA Procurement
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