State must get back R50m

2010-11-04 14:41

The Democratic Alliance today urged the government to retrieve what it says was an estimated R50 million overpayment to a security company associated with axed Communications Minister Siphiwe Nyanda.

DA spokesperson Jack Bloom said: “I estimate that we probably overpaid Abalozi more than R50 million, and legal steps should be taken to recover the wasted money from those who should have prevented this from happening.”

Abalozi Security Risk Services won a R71 million contract in 2007, which former Gauteng transport MEC Bheki Nkosi had admitted earlier this year had been awarded without procurement processes being followed.

The company is owned by Nyanda’s family trust. Its contract with the Gauteng roads department was cancelled in December. It finished offering services to the department in March.

Bloom said cancelling Abalozi’s contract had saved the department an estimated R24 million a year.

“It was grossly overpaid for work that other companies could do far cheaper.”

According to Bloom the same services being were being provided for considerably less.

“Instead of paying nearly R850 000 a month to Abalozi to guard G-Fleet at Bedfordview, Pothlako Security and Cleaning Services is doing the job for about R185 000 a month,” he said.

G-Fleet, established in 2001, is the Gauteng government’s provider of leasing and fleet management services.

He cited other examples of where costs had since been drastically cut.

“This whole matter stinks, especially in view of the fact that Abalozi was part-owned by politically connected Nyanda when it got the tender, and his family continued to benefit from this company after he transferred his share into a family trust.”

Gauteng Premier Nomvula Mokonyane should act on the Public Protector’s recommendation to investigate the awarding of the contract.

The transport MEC at the time the contract was awarded was Ignatius Jacobs, the premier Mbhazima Shilowa, who left the ANC to help form Cope, and the accounting officer Sibusiso Buthelezi. The latter was given a R1 million settlement to leave the department amid corruption allegations.

Nyanda had not been appointed to Cabinet then.

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