News24

Tender fraud frequent - PSC

2010-03-10 18:05

Cape Town - Corruption frequently occurs at the quotation stages for contracts under the R200 000 threshold, a Public Service Commission (PSC) presentation to the National Assembly's public service and administration committee showed on Wednesday.

The invitation for quotations, the required number of quotations obtained, and the evaluation of quotations received often do not comply with procurement rules.

Democratic Alliance MP Anchen Dreyer said after the meeting the PSC undertook a study into the management of fraud and corruption risks in the supply chain management process when it became clear the total number of cases of financial misconduct reported to the PSC had dramatically increased over the past years.

In the 2005/06 financial year 771 cases of financial misconduct were reported to the PSC by national and provincial departments. This number increased to 1042 in the 2006/07 financial year, she said in a statement.

Quotations

The national and provincial departments of public works and housing were involved.

The PSC found no quotations were obtained before orders were placed with service providers in 29% of all transactions evaluated.

In 45% of all transactions the required number of quotations was not called for, and in 46% of transactions the quotations were not evaluated as required by procurement rules.

The rate of compliance with procurement rules relating to the invitation of quotations in four provinces, including national departments, was below the average rate of 71%.

Gauteng had a compliance rate of 58%, the Western Cape under the former premiership of Ebrahim Rasool 47%. National departments showed only a 54% compliance.

"However, these figures are most likely worse, as not all departments at both national and provincial level submitted the requested information," Dreyer said.

The DA had proposed that the offending departments be called to appear before the committee to account for their non-compliance and explain why these reports were not presented.

The PSC had made certain recommendations and the DA proposed the offending departments be asked to implement them.