GijimaAst to cut jobs after contract loss

2010-04-24 08:42

FOLLOWING the loss of a R3.9 billion contract from the Department

of Home Affairs due to alleged non-performance, GijimaAst is facing a fresh

battle – to keep morale among its 4 000 employees high as it starts


“These developments are disruptive to us. In between doing our work

we now need to look for new jobs,” an employee said on Friday.

The employee said GijimaAst had initiated the retrenchment process

and workers who were affected would need to leave the company by the end of


Jonas Bogoshi, GijimaAst chief executive, said the retrenchments

were a realignment of the business to reflect the effect of the recession on the

company, and its new focus.

Until two weeks ago, the company was hard at work on the home

affairs contract to build a paperless, high-tech security system to process

identification, work permits, ­visas and other international travel documents

faster. The ultimate goal was to limit the chances of manipulation of the

process by people.

At a high-level meeting in Pretoria two months ago the two sides

sat around a table. Key representatives for Gijima: executive chairperson Robert

Gumede and Bogoshi. Key representatives for home affairs: minister Nkosazana

Dlamini-Zuma and director-general Mkuseli ­Apleni.

With the World Cup looming, the meeting was tense.

Gijima promised to deliver a visa processing system at 34 points of

­entry into the country.

It also promised to deliver a visa application system in nine

missions in countries that were expected to provide the most visitors to South

Africa. This was scheduled to be done by the beginning of next month.

At a second meeting later in February the wheels came off. A source

close to the department says Gijima told the minister it would be able to

deliver its systems to only 12 points of entry and three foreign missions. A

source with knowledge of the negotiations says that decision was mutual, because

the 12 points of ­entry covered 93% of points of entry and 87% of missions

expected at the Cup.

After this, Dlamini-Zuma approached Cabinet to seek permission to

get out of the GijimaAst contract or declare it invalid.

The department has said it will not make any public comments

­regarding the cancellation of the contract. This comment came after it wrote on

April 13 to ­GijimaAst to inform it that the ­tender was invalid.

Bogoshi did not comment about the cancellation, pending its legal

challenge to enforce the contract which contributed 15% of ­GijimaAst’s


He said the home affairs contract was managed by a team of 160

highly skilled workers, some of whom were contract employees.

He said some of the company’s full-time employees could be absorbed

into other parts of the business should Gijima lose the contract.

The source added that the main reason the contract did not run

smoothly was that the department was ill prepared to handle a project of such


The department’s premises were also not purpose-built for the main

operating platform, and it lacked the staff to effectively monitor and implement

systems with Gijima, the source said.

State lawyers are negotiating for the department, while GijimaAst

has engaged its own lawyers, Brian Kahn Attorneys.

Bogoshi and some of his top executives have had a busy week talking

to their shareholders, partners and major clients to update them on the process

and placate them.

He remained upbeat about the prospects for the business.

“We believe the industry will be flat this year and start to grow

from next year. We have a healthy pipeline of projects that will carry us

through,” he said, adding that 90 of the top 100 JSE companies were GijimaAst’s


Home affairs has asked the SA Revenue Service to take over that

part of the project which relates to the facilitation of tourists’ entry into

South Africa for the World Cup starting in June.

SARS has appointed 10 IT firms to deliver on the project.

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