Agency in R10m row over graft

2010-05-29 08:56

The Cross-Border Road Transport ­Agency has been rocked by

allegations of wasteful expenditure amounting to nearly R10 million.

Documents in the possession of City Press show that the agency,

which manages the cross-border road transport industry, awarded a R90 000

contract to Benz Repairs and Renovations last December to refurbish its

headquarters in Menlyn, Pretoria.

A quality-control company, NH Smallwood, wrote a report saying that

Benz had done shoddy work and that the contract should be terminated. A week

before Benz was due to finish the project, the Cross-Border Road Transport

­Agency sent an email instructing the company to stop work on the project.

The agency, which falls under the ­Department of Transport,

informed Benz chief executive Ben Vorster that the ­contract had been terminated

because he had failed to finish the work on time.

Sources allege that the agency then re-awarded the contract to NH

Smallwood, which raised the contract’s value from R90 000 to R5 million.

This week Vorster said he was preparing to sue the agency for

breach of contract. He said he had been paid only R45 000 to buy materials and

the other half, for labour, was outstanding.

He said the contract was revoked after he had completed 90% of the

work.

Chairperson

Gilbert Phalafala acknowledged that the agency was plagued by “forms of

misdemeanours including the non-observance of governance principles and internal

control processes”.

He said: “As part of the agency’s drive to address its challenges,

a concerted effort is being made to review all governance, internal control and

procurement policies. We would like to reaffirm our commitment to rooting out

any form of wrongdoing that may have taken place.”

On December 4 last year the agency ­issued separate payments

totalling R187 200 to ­Watnex and Wernex for “strategic consulting”. The agency

could not explain why ­Watnex was paid R48 000 and R24 000 on the same day for

services pertaining to the rationalisation of the agency’s management

team.

Reasons were also not given for why the agency paid Watnex R22 500

and R44 700 for services rendered in ­connection with the formulation of the

agency’s performance management ­system on the same day.

Another R32 000 and R16 000 were paid to Watnex for services

related to the rationalisation of the agency’s regulatory and law-enforcement

functions.

It is alleged that in March this year the agency paid R9 000 to law

firm DLA Cliffe Dekker Hofmeyer for labour ­relations consultations.

Out of this amount the agency paid R1 600 to register a closed

corporation.

It was not clear who the closed ­corporation belonged to.

In what appears to be a case of conflict of interest, board member

Bongisizwe Mpondo was offered an open-ended contract in March 2007 to act as a

consultant.

Mpondo was paid R234 000 for each quarter of the year while working

two days a week. This amounted to almost R3 million over three years.

 


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