It is undesirable that councillors, especially the Executive Mayor and MMCs, should be effectively excluded from overseeing the tender processes followed in their portfolios, writes Mpho Phalatse.
For valid reasons, there is heightened public anxiety when it comes to tenders. This is especially so in the light of the revelations of corruption and looting of public coffers that emerged from reports issued by the Zondo Commission into state capture.
This is not a new phenomenon, but the scale just seems to have escalated exponentially during the Zuma years. This is ironic given the plethora of legislative provisions enacted to trap those pernicious individuals that use procurement processes to loot the public coffers.
The Municipal Finance Management Act (MFMA) became law in 2003. Up until that time, contracts above R200 000 were reported to the Tenders Committee, which considered the recommendations of staff who administered the procurement of capital projects, goods and services and either approved or rejected a report on each and every tender put before them.
Tenders Committee abolished
However, the MFMA abolished the Tenders Committee, which was a committee of councillors drawn from all political parties represented in the Council. It should be asked whether this was a good thing. After all, councillors were not in a position to appoint a preferred supplier. They were required to oversee a report that already assessed the tenders in terms of price, compliance, and track record of performance, among other things. The details of all bidders and their bids were included.
In most cases, the recommended bidder was the one with the lowest price. Occasionally this was not so. In these instances, a justification was provided. The councillors on the committee would bombard the presenters of the report with questions. On such occasions, the report was rejected if the reasons given were not compelling or suspicious in any way. There were even cases when a report was rejected for lack of clear evidence of proper value being obtained for the money that would be spent.
No doubt, the legislators who drafted the MFMA wanted to remove opportunities for graft from politicians. Anecdotally, in parliamentary circles, there were cases cited wherein mayors and councillors abused the system for personal gain. A colleague of mine who served on the Johannesburg Tenders Committee as a councillor has stated that a committee of individuals could not, in his experience, manipulate a report that made recommendations and get away with it. Politicians from rival political parties were more than ready to catch each other out if there was a hint of interference by another politician in the process.
So, the MFMA took away the one and only, albeit limited, opportunity for Councillors to participate in the process of awarding certain types of contracts. This was done in the name of combatting corruption. But who says that only councillors commit acts of corruption? Is it really the case that staff members in the Council’s procurement departments are scrupulously devoid of corrupt tendencies?
Dozens of cases of corruption
There were no known instances of tender corruption in the contracts that went through the Tenders Committee in Johannesburg in the years from 1995 to 2003. However, since then, the Council’s Group Forensic Investigative Service (GFIS) led by General Shadrack Sibiya have uncovered dozens of cases of corruption.
It appears the MFMA made things worse not better.
Under the MFMA, councillors only get to see the outcome of a tender process. There is no opportunity to interrogate the recommendation to award a contract to company A over company B. There is no opportunity to probe the recommendations to determine whether the decision provides the best value for public money. Indeed, most reports of outcomes of the deliberations of the supply chain officials are a list of who got awarded the contracts and for how much. There is no indication of who else bid and what their bids were. Moreover, when councillors ask searching questions, they are continuously reminded that the MFMA forbids them from interfering with the procurement process. Why is the councillor’s job of oversight of processes being so constrained? What are these officials hiding?
Member of the Mayoral Committee (MMC) for Economic Development, Cllr Nkuli Mbundu, has found himself accused of such interference. On the face of it, he attempted to determine the value for money of a fence that was being awarded for R15 million, which would ordinarily cost only R3 million in the open market.
Another MMC, Cllr Leah Knott, politically responsible for the City’s Group Corporate and Shared Services, was recently accused of interference when she enquired why a cellphone contract was being awarded to a service provider who was recently implicated in one of those dodgy deals uncovered by GFIS. Why can she not ask such questions as part of oversight? Is someone hiding something?
MFMA must be re-examined
The MFMA surely needs to be re-examined. The opportunity for public representatives to oversee the work of the administration needs to be more, not less, particularly when it comes to determining how public money has been spent.
Perhaps a recent court judgment that examined the conduct of the former Gauteng MEC for Health, Dr Bandile Masuku would be helpful. There was manifest corruption in the procurement of PPE in the Health Department during the lockdown after the emergence of Covid-19. Dr Masuku attempted to distance himself from the corrupt procurement, stating, “he was not allowed to interfere in procurement matters”. The Court respectfully disagreed. The Court found that the approach adopted by Dr Masuku to remain utterly uninvolved in the governance of the emergency procurement for Covid, displayed a serious lack of judgment about his role.
It is undesirable that councillors, especially the Executive Mayor and MMCs, should be effectively excluded from overseeing the tender processes followed in their portfolios. Oversight mechanisms should allow councillors to determine whether goods and services are being procured on date, on budget, and on specification.
They need access to processes to ascertain:
- whether the targets in the business plans would be achieved through timeous implementation of the tender processes,
- whether good value for money would be received, for example are the prices for the expected goods and services market related,
- whether the policies and procedures would be complied with,
- whether the awards are being made clearly, without favour or prejudice.
Regretfully, I advise that this is not the case currently. The time for a review is long overdue.
- Mpho Phalatse is the Executive Mayor of Johannesburg
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