Outa lodges complaint against Sanral over R4.7bn tender in KZN

The Organisation Undoing Tax Abuse (Outa) has lodged a complaint with the Information Regulator about the failure of the SA National Roads Agency (Sanral) to provide all the requested documentation about a R4.7 billion tender award in KwaZulu-Natal to a company whose directors are facing fraud charges.

Outa legal project manager Asavela Kakaza said on Wednesday the information about the tender awarded to the Aqua/EXR joint venture (JV) was requested from Sanral in terms of the Promotion of Access to Information Act (Paia), but the roads agency only provided part of the information requested and refused the rest.

Kakaza stressed that in terms of Paia, disclosure is the rule, not the exception.

Outa said the directors of Aqua Transport and Plant Hire, one of the companies now forming the Aqua/EXR JV, were arrested in September 2022 on charges of fraud, theft, and corruption related to a 2012 tender with the KwaZulu-Natal Department of Roads and Transport.

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It referred to a written reply by Minister of Transport Sindisiwe Chikunga to a question in parliament in October 2023.

She said the Department of Transport has confirmed that Sanral is aware of the allegations Aqua Transport and Plant Hire is facing, but according to information at Sanral’s disposal, Aqua is neither blacklisted nor restricted on National Treasury’s Central Supplier Database and, as such, the company is not prohibited from doing business with government and/or its entities.

Chikunga said Aqua is also not a blacklisted/restricted service provider on Sanral’s database.

She noted that legal advice obtained by Sanral indicated that under South African law, Aqua directors are considered innocent until proven guilty in a court of law. As such, Sanral was legally duty-bound to award the tender to the Aqua/EXR joint venture as the highest-scoring bidder.

“To mitigate any possible risk down the line, Sanral has however built in an award provision that should the company’s directors be found guilty in a court of law, Sanral reserves the right to terminate the contract,” Chikunga said.

Charges should have ruled JV out

However, Outa believes that the criminal charges against the Aqua directors should have ruled out the JV from being considered for the contract.

Kakaza said that even if the contract is cancelled, if the directors are convicted, it may be too late to stop the loss of payments on the contract.

Comment was requested from Sanral but a response has not yet been received.

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Outa also referred to a judgment handed down last week in the High Court in Pretoria overturning the award by Transnet of a tender to Aqua Transport and “the common cause adverse findings against Aqua” and that court remarking that “the appointment of Aqua was so unreasonable that no reasonable person could have taken such a decision”.

“This is one of the reasons Outa wants access to the information pertaining to the tender that Sanral awarded to Aqua Transport. We want to check the rationality and reasons behind that decision,” Kakaza said.

Tender details

The Aqua/EXR JV was awarded the tender on 3 May 2023 for capacity improvements to a 5.74km section of the N3 in KwaZulu-Natal from the Westville viaduct to the Paradise Valley interchange.

The contract was scheduled to commence on 7 June 2023 and has a duration of 51 months.

Sanral received four bids for the tender. They were:

• Paradise Valley Joint Venture: R6 687 156 136.21;
• Aqua/EXR Joint Venture: R4 726 396 217.26;
• UNIK/UMSO Joint Venture: R3 780 000 000.00; and
• Raubex KZN (Pty) Ltd: R4 794 444 000.00.

Kakaza said Outa submitted the request for information in terms of Paia to Sanral on 23 June 2023, and the road agency had partially granted the request on 20 October 2023.

She said the documents Sanral refused to give Outa access to were the following:

• Tender/Bid submissions from the four bidders
• Tender/Bid compliance checklist
• Bid Evaluation Committee’s minutes and report
• Bid Adjudication Committee’s minutes and report
• Board Committee’s minutes and report; and
• Responses from the bidders during the evaluation process.

Kakaza said Sanral refused to provide Outa with these documents because they contained commercially sensitive information, which required consent from the third parties affected.

However, she pointed out that Sanral initially failed to attempt to get consent and referred to sections of Paia that override the restriction on commercially sensitive information “if the disclosure of the record would reveal evidence of a substantial breach of the law or an imminent and serious public safety or environmental risk; and where the public interest in the disclosure clearly outweighs the harm contemplated in the section relied upon to refuse access”.

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Kakaza said Outa, therefore, wishes to evaluate this tender’s legality and stressed that this is of public interest. However, she added that Outa will only be able to evaluate the legality of this tender once the records referred to in its request are produced.

Information Regulator complaint 

Kakaza confirmed that Outa lodged its complaint with the Information Regulator on 10 April 2024 and received an email from the regulator on 16 April 2024 confirming receipt of Outa’s complaint and advising that further communication would follow.

She said Outa is unsure how long the investigation will take but will keep following up with the regulator.

Kakaza said the regulator has the power to investigate the complaint and refer its findings to its enforcement committee for a decision.

She added that after considering the recommendations of the enforcement committee, the regulator has the power to serve the information officer of a body with an enforcement notice confirming, amending, or setting aside the decision that is the subject of the complaint or requiring the information officer to take such action or to refrain from taking such action as the Information Regulator has specified in the notice.

The information officer of a body that refuses to comply with an enforcement notice is guilty of an offence and liable, upon conviction, to a fine or to imprisonment for a period not exceeding three years or to both such a fine and such imprisonment, she said.

However, Kakaza said that regarding Outa’s complaint, they hope that an enforcement notice will be issued to Sanral requesting that it furnish the organisation with the requested information.

This article was republished from Moneyweb. Read the original here.

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