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Sentech slams set-top box graft allegations

Simnikiwe Mzekandaba
By Simnikiwe Mzekandaba, IT in government editor
Johannesburg, 30 Mar 2022

Sentech has shot down graft allegations regarding its recent set-top box (STB) installation tender, saying a “shortened [tender] advert period is allowed and part of its supply chain procedure manual”.

Last week, the Organisation Undoing Tax Abuse (Outa) issued a statement alleging Sentech was using the digital migration deadline (of then 31 March) to push through a “huge” tender to install STBs without the necessary transparency and appropriate advertising.

Outa, which called for an immediate halt of the tender, claimed the last-minute sign-up of STB installers on a three-year deal could be worth R300 million.

According to Outa, the National Treasury regulations for departments, trading entities, constitutional institutions and public entities, issued in terms of the Public Finance Management Act, state in section 16A6 3(c) that the accounting officer or accounting authority must ensure “bids are published in the government tender bulletin for a minimum period of 21 days before closure, except in urgent cases when bids may be advertised for such shorter period as the accounting officer or accounting authority may determine”.

“We do think this points to possible serious irregularities, as Treasury’s procurement regulations require adverts to run for at least 21 days,” advocate Stefanie Fick, Outa executive director, says in the statement.

“This is how we believe corruption takes place. Someone may sneak in a huge tender with a very limited public view, so only the bidders who are tipped off see it.”

Responding to ITWeb’s questions, Sentech confirms it issued a tender for STB installer panellists on Tuesday, 22 March, that closed on Friday, 25 March.

The state signal distributor further points out this is not the first time the company has gone on tender for STB installation companies, noting that approximately 14 various tenders have been previously issued.

“The said tender ran for three days, and a shortened advert period is allowed and is part of Sentech’s Supply Chain Procedure Manual,” says the company.

“The principle of a shortened tender advert period can also be drawn from the National Treasury Regulations 16A6.3(c), which Sentech is not bound by, as a schedule 3B entity, but has utilised as a guiding document for its own supply chain policy and procedure manual.”

The Department of Communications and Digital Technologies (DCDT), which is headed by minister Khumbudzo Ntshavheni, is charged with overseeing SA’s much-delayed digital migration project.

Sentech is the entity currently responsible for the STB installations.

Government is subsiding indigent households – those with a monthly income of less than R3 500 – with free STBs or digital migration decoders. The STBs are required to convert digital broadcasting signals on analogue TV sets.

Qualifying households are required to register for these devices at their nearest SA Post Office branch. Once registered, government-approved installers/installation companies will install the devices.

The terms of the advertised tender are for a panel of STB installers or installation companies for the installation of domestic digital terrestrial television STBs, direct-to-home STBs and integrated digital TV receive system in the Eastern Cape, Western Cape, Limpopo, Mpumalanga, KwaZulu-Natal and Gauteng, according to Outa.

In its statement, Sentech explains the advertised tender for more installers is to augment its STB installer panel, which will be utilised to install for the current government STB installation programme and future business of similar nature.

“There are currently 509 STB installation companies on the Sentech panel, and the company will continue to advertise to augment the panel as business needs grow.”

During oral replies in Parliament last week, minister Ntshavheni said start-ups have been key players in the countries that are succeeding in the implementation of the digital economy.

As a result, her department, and in partnership with Sentech, is looking to ramp up the implementation of the digital migration project by increasing the capacity of STB installations.

“The increase of installer companies also translates to an increase in the number of jobs that are created through the project,” she said.

To date, 1.4 million indigent households have been registered for government’s free decoder and installation.

Ntshavheni stated yesterday that the DCDT remains committed to ensure the 507 251 households that registered for STBs by 31 October 2021 are connected by no later than 30 June 2022, which is the date to which the court has deferred analogue TV signal switch-off.

"In addition, the department will ensure 260 868 households that registered between 31 October 2021 and 10 March 2022 are connected to their STBs by no later than 30 September 2022.”

After missing the International Telecommunication Union-mandated June 2015 migration deadline, government is playing catch-up to ensure the country migrates to digital TV, to allow for the spectrum dividend occupied by the analogue TV signals to be freed up for mobile broadband services.