The Department of Transport (DOT) denies claims that its renewal of the Tasima contract to manage the Electronic National Traffic Information System (eNatis) is unlawful.
Democratic Alliance (DA) shadow transport minister Stuart Farrow said leaked correspondence between eNatis manager, Tasima, the Road Traffic Management Corporation (RTMC) and the DOT shows the extension of the contract is questionable. However, the department firmly denies the controversial nature of this extension.
The main concern was that a public tender did not go out before the contract was renewed.
Tasima's contract began in December 2001 and expired in May 2008. The company has since been working with the department on a month-to-month maintenance contract, until the beginning of 2010. The contract was then renewed in May this year, for a further five years.
Maintaining continuity
The DOT says eNatis is an important national resource and such a critical tool for service in the country cannot be disrupted without a guarantee of the ensured continuity of services.
It adds that when the contract for the development and maintenance of the eNatis was awarded in 2001, provisions were included to manage a smooth and orderly handover of the system from the current service provider to the state upon expiry of the contract.
“Schedule 15 of the contract mandates the Department of Transport upon expiry of the contract, to implement the transfer management provisions as contained in the original contract (schedule 15).
“The transfer management provisions allow the department to terminate the current terms and conditions of the contract and to enter into a transfer management plan whereby the current service provider is obligated to support the system as agreed in a formal transfer management plan.”
The department says such a plan will include the phasing out of current services performed by the appointed service provider to the state, or new contractors appointed by the state.
“The department is not extending the contract in terms of standard regulations but implementing a transfer management clause that was included in the original contract. The contract runs and provides measurable skills transfer and capacity building.”
Small tenders
It also says that through schedule 15 of the contract, it invokes rectification of the contract in line with the Public Finance Management Act, in order to ensure proper internal capacity is built within the department and the RTMC to take over certain functions performed by the service provider, and to issue separate smaller tenders for some of the technical services that cannot be performed internally.
“Although the department is currently in the process of implementing the transfer management provisions of the contract, final terms and conditions, rates, and contracting are yet to be finalised.”
“This presented Tasima with a challenge where, as a service provider, they could not retain expertise and personnel. The resultant negative impact on the running of the eNatis system cannot be overemphasised.”
It adds that it is this challenge that made Tasima write to the department requesting an extension, “which the department granted upon consultation and careful consideration of the likely repercussions on the matter”.
The department is then currently entering into the transfer management provisions where it says comprehensive skills transfer will be implemented, and the RTMC is currently establishing the required skills to take over the management of the eNatis system.
“Tasima is in a position to meet its obligation of achieving 98% availability of the system - an important yardstick for the delivery of services to the people of South Africa.”
Tender requested
Copies of the leaked correspondence letters show RTMC acting CEO Collins Letsoalo requested that a tender be advertised publicly before the contract was renewed.
“The Tasima contract is long due for re-advertisement to give other service providers a chance to participate.”
He added that the rates charged by Tasima were very high for a maintenance contract and noted that the department could not afford it. “More than R200 million a year for maintenance of a system cannot be sustainable.”
ITWeb could not reach the department this morning to comment on the affordability of the maintenance contract.
Letsoalo's request for a public tender process was turned down and transport director-general George Mahlalela awarded Tasima the five-year extension.
“A further reply to a DA parliamentary question reveals that the contract was also awarded without going to tender - even though Tasima's previous contract had expired in 2008, and the Standing Committee on Public Accounts (Scopa) had raised concerns about the contract not being re-advertised,” says Farrow.
No explanation
The department has also not explained its concern for the interests of Tasima shareholders.
In providing reasons for the contract not going out on tender, Zakhele Thwala, the department's deputy director of Transport Regulation Accident and Incident Investigations, said: “It is in the best interest of eNatis and new shareholders to renew the current contract.”
Letsoalo said he was “puzzled” by Thwala's concern for the interests of Tasima shareholders.
Farrow also voiced concerns in this regard: “Why were the shareholders of a private company apparently a matter of concern to the Department of Transport?”
He has requested Scopa to investigate the matter to determine if the extension is legal. Farrow adds that the DG of the DOT will be asked to appear before the portfolio committee.
At a cursory level, eNatis essentially handles the registration of cars and bookings of learners' and drivers' tests at various licensing and testing stations across the country. Mphuthi says the service may in future handle other transport-related services, like online fine payment and the ability to renew drivers' licences online.
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