Govt deals: shock KZN facts

2009-10-23 00:00

PUBLIC servants in some KwaZulu-Natal government departments and their spouses benefited from R136 million worth of business they conducted for the government between April 2005 and March 2007.

This is according to the Auditor-General’s report tabled in the KZN Legislature yesterday.

The report by Auditor-General Herman van Zyl stated that the “majority of government employees did not have approval to perform other remunerative work”.

“Some departments … had deviated from the supply chain management process without the necessary approval by awarding tenders to or accepting quotations from employee-related entities,” stated the report.

It added that this could be an indication of preferential treatment or fraudulent activities in the adjudication of tenders or quotations.

The report found that 308 employees did business with their own departments and the amounts paid totalled R25 897 217. These employees were identified as directors or members of companies or close corporations. Most of these employees (220) were in the Education Department, 77 in the Health Department and six in the Agriculture and Environmental Affairs Department.

Sixty-nine employees have spouses who are directors or members of companies that conducted business with their departments. These tenders amounted to R34 859 085. Most of the employees were in the Education (33) and Health (32) departments.

A total of 539 employees were identified as company or close corporation owners who did business with other departments, making R75 477 525. In these cases, 359 employees were from Education, 114 were in the Health Department, 20 in Agriculture and Environmental Affairs, five in Economic Development, four in Arts and Culture and six in the Provincial Treasury, as well as various others scattered through other departments.

In the case of procurements worth R870 510 in the Education and Health departments, fewer than three quotations were obtained. In one instance, said the report, the Education Department accepted the second lowest quote of R47 500 submitted by an employee, while rejecting the lowest quote, of R20 400.

In the case of business worth R1 396 595, four employees, one in Education and three in Health, did not supply the required VAT registration.

The A-G’s report stated that the employees who benefited from government contracts did not request and receive approval to do business with government.

It recommended that disciplinary action should be taken against them.

The Democratic Alliance described the findings of the report as “shocking”.

DA caucus leader in the legislature John Steenhuisen said it is time to bring an end to such practices. “Government employees must decide whether they want to be public servants or business persons — they cannot be both.

“It is simply inconceivable that a public servant is able to provide the best service possible with the distractions provided by their business enterprises.”

Surely it is not coincidental that the departments with the highest number of employees doing business have the biggest service delivery challenges, Steenhuisen added.

“It is entirely naive to believe that there will not be some inherent bias, either tacit or implied, when dealing with such companies,” he said.

Steenhuisen said the DA will ensure that the recommendations made by the A-G are implemented.

308: Employees who did business with their own departments

220 : Education Department employees with Education Department contracts

77: Health Department employees trading with the Health Department

R25,7 million: Amount paid to these businesses

539: Number of public servants doing business with departments other than their employers

R75,4 million: Amount paid to these businesses

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