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Controversy surrounds Nyanda again

Farzana Rasool
By Farzana Rasool, ITWeb IT in Government Editor.
Johannesburg, 16 Aug 2010

Mpumalanga's Department of Cooperative Governance and Traditional Affairs (COGTA) has confirmed media reports of a contract granted to Abalozi Security Risk Advisory Services.

The company, which is partly owned by the family of communications minister Siphiwe Nyanda, has been under fire for a number of irregular tenders recently.

Media reports claim the department gave Abalozi a R20 million contract to investigate service delivery protests in Mpumalanga, without advertising the tender or seeking competitive bids.

“The Department of Cooperative Governance and Traditional Affairs confirms that it entered into a formal contract with the said service provider.”

Head of communications for the provincial department Simphiwe Kunene confirms the contract was granted last year, but also says it came to an end around November.

He denied the reported value of the contract. “It was more like R7 million, but it was definitely not the R20 million that was reported.

“The department followed the procurement provisions as prescribed by the PFMA [Public Finance Management Act] and other Treasury regulations in sourcing such services.”

Inadequate systems

The COGTA explains that the need for such services was prompted by the inadequacy of the early warning systems, following the service delivery protests in the province through mid-2009 and the earlier part of 2010.

“The said consultants had a clear mandate of conducting risk assessments in municipalities that have been affected by these protests, determine the root causes and recommend mitigation measures to be undertaken by the department and affected municipalities.”

The department did not provide any detail on the conclusions or the recommendations by the time of publication, despite requests from ITWeb.

“It is by now common knowledge that not only lives were lost during the unrests, but government properties, councillors houses were torched, public facilities such as schools and libraries were also burnt down, while the community tensions flared up due to the unfortunate and apparent incapacity of local governments to deal with the protests head-on.”

The department says in light of this, it was warranted to provide support and engage in strategic interventions in managing the risk factors that were emerging.

“The contract with the service provider has since lapsed. We are pleased to indicate the correctness of our decisions to establish an early warning system through the risk assessments process undertaken by Abalozi.

“Through this initiative our response capability has been improved significantly and all the municipalities that were affected have been ably supported to craft and adopt their individual municipal turnaround strategies in response to the issues raised.”

Further investigation

The Public Protector found Nyanda not guilty of violating the Executive Members Ethics Act or the corresponding provisions of the Code of Ethics with regards to a contract granted to Abalozi by the Gauteng Department of Public Transport and Works.

However, it was found that the tender was granted irregularly and the Public Protector recommended further investigation into the circumstances and other irregular tenders.

Having congratulated the Public Protector on the findings of the investigations into allegations of misconduct by Nyanda, Cosatu spokesperson Patrick Craven now says further investigations must be carried out.

“Following the Public Protector's investigations into previous allegations, exactly the same should happen now. The allegations should be fully investigated to determine if there is any truth in them.”

DA corruption spokesperson Jack Bloom agrees, saying the Public Protector previously found that Abalozi does not provide unique services and therefore the tender should have been advertised.

“She [Public Protector] found that all irregular tenders should be investigated. It's incredible that this should surface now. It needs to be investigated like the others. It's as simple as that. It's part of the recommendations made to President Jacob Zuma that any contract over R1 million should be investigated, and this is well over.”

Three investigations

The first complaint about issues of conflict of interest on behalf of the communications minister was about his alleged breach of the Executive Members Ethics Code for receiving benefits from an allegedly irregular tender from Transnet.

Julie Killian, of Cope, laid this complaint on 19 March. Nyanda's company, General Nyanda Security (GNS) Risk Advisory Services, was awarded a R55 million contract by the now-dismissed Transnet Freight Rail CEO Siyabonga Gama. Nyanda came out in support of Gama in his legal battles.

The second complaint was laid by the DA. “It relates to a tender that was allegedly irregularly issued by the Gauteng Department of Transport to a company linked to Minister Nyanda (Abalozi Security Risk Advisory Services), before he became a minister, and his continued benefit from the contract now that he is a minister and has a duty to protect government interests,” said Public Protector spokesperson Kgalalelo Masibi.

The DA also put through the third request, which was that all state tenders awarded to companies linked to Nyanda should be investigated. Mazibuko sent the request letter to the public protector on 19 July. The report for this investigation will be ready in October.

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