‘Irregularities’ in mega tender

2013-09-10 12:24

There were several irregularities with the awarding of a multibillion-rand social grant tender by the SA Social Security Agency (Sassa), the Constitutional Court has heard.

“This is not just another tender case... The irregularities on which we rely are not inconsequential,” said Advocate Gilbert Marcus, SC, for the unsuccessful bidder Allpay Consolidated Investment Holdings.

Marcus argued that the tender process was procedurally flawed and unfair, and violated sections of the Constitution.

The R10 billion tender was awarded to Cash Paymaster Services (CPS) for the administration of social grants over a five-year period.

Sassa initiated the tender process, aiming in part to address fraud and theft problems within its system.

Advocate David Unterhalter, also for Allpay, submitted that the criteria for the tender were not clear and transparent, and failed to meet the mandatory requirements of section 217 of the Constitution.

He said a second bidder’s notice was designed to eliminate bidders other than CPS.

Unterhalter said “Bidders Notice Two” led to a preference in the bidding process being made a requirement, which had an affect on scoring and led to Allpay being disqualified.

“Only when it moved from a preference to a requirement they did not qualify,” he said.

Bidders Notice Two required that every payment made have biometric verification.

Biometric verification occurs when a person is uniquely identified through biological traits based on 10 fingerprints.

At the moment, bank ATMs did not have biometric capabilities, the court heard.

Allpay previously approached the North Gauteng High Court in Pretoria with concerns about the tender process.

The court found in its favour and ruled that the tender process did not comply with the requirements, and was procedurally unfair.

The court declared the tender process invalid, but did not set the tender aside because this would have disrupted the delivery of social grants.

Allpay appealed to the Supreme Court of Appeal (SCA), but it overturned the high court order with a finding in favour of Sassa.

The SCA held that a fair process did not demand perfection in every step, nor could a tender be set aside for inconsequential irregularities.

In the Constitutional Court, Allpay wants the SCA’s decision set aside.

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