Public goods are being privatised

2012-07-14 13:54

EduSolutions. Get to know this ­company because it is everywhere.

We have written about it because the firm won the contract to procure and ­deliver school textbooks to Limpopo, and crucial aspects went wrong.

So many young ones did not have books for half the year.

That contract was terminated, but many others exist, often as part of its parent company, called African Access Holdings.

In a decade, the executives of the company have become rich off the state, building up fortunes that would have taken other businesspeople a generation to make. Are they brilliant, or are we being ripped off? You decide.

But what is happening is no less than the ­privatisation by stealth of the education procurement system, with no concomitant reduction
in the fiscal responsibility of citizens.

Basically, you are paying twice: once to civil servants and another time to companies across the state who are taking over complete ­government functions like procuring and ­delivering textbooks.

Often, they make a hash of it and then you pay a third time to fix it.

Of further concern is the shifting line between private enterprise and the state.

EduSolutions and its associated companies are peppered with senior former education department officials, all of whom have walked through rapidly revolving doors from the public to the private sector, ­making valuable contacts and networks, which they parlay to lucrative ends.

In Limpopo and other provinces like KwaZulu-Natal, Mpumalanga and Gauteng, EduSolutions has contracts worth hundreds of millions doing what the education departments there once did for themselves.

In return for their substantial spending, these departments receive a meaty 30% discount from suppliers, putting hundreds of millions of rands back into education spending each year.

Now, most of that discount flows into the ­coffers of EduSolutions – on top of a substantial management and administration fee to boot.

This is in the contracts EduSolutions signed with the state across the country.

A legal opinion found that this prevented the education department getting products cheaply and effectively.

And that’s the nub of it. School books for our children cost more because of these deals.

In a country where every cent should be geared towards the effective education of its children, how can this be justified?

There is also no indication that government intends moving on other EduSolutions contracts in other provinces where the deals are the same.

We can only ask why?

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