SITA cracks whip on Gauteng Broadband Network project

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Altron Nexus on Tuesday paid a group of small and medium enterprises (SMEs) contracted to work on the second phase of the Gauteng Broadband Network (GBN).

This follows a report by ITWeb that the implementation of the multibillion-rand project risked extended delays, with fresh allegations of corruption and non-compliance raised by the SME service providers.

At the time, the group of SMEs made damning allegations of maladministration, greed and nepotism, and said the laws and regulations that govern the project had been deliberately contravened. This prompted the State Information Technology Agency (SITA) to demand answers from Altron Nexus, previously known as Altech Alcom Matomo.

Altech Alcom Matomo was awarded phase one of the GBN project, valued at R1.2 billion in 2013, for the building of a core network and connection of 450 sites. The tender for phase two of the GBN was also awarded to Altech Alcom Matomo in 2018, at a contract value of R2.8 billion.

Some of the key demands of the GBN contract are that 40% of work should be awarded to Gauteng-based small businesses in the five regions of the province: the City of Johannesburg, Ekurhuleni, Tshwane, West Rand and Sedibeng.

The SMEs claim this was not done and they were sidelined from the project. Meanwhile, those that were lucky to be contracted weren’t paid, despite Altron Nexus having been paid.

The group of SMEs also said Altron Nexus had misrepresented the number of small businesses working on the project, claiming 47 had been contracted but in fact only seven had actually been working on the project. Of the seven, only four had been paid for their services rendered to the GBN project.

Following the publication of the plight of these SMEs by ITWeb, the new Gauteng MEC of finance and e-government Nomantu Nkomo-Ralehoko met with SITA and Altron Nexus to discuss the concerns of the small businesses.

SITA then demanded a project delivery report from Altron Nexus.

Acting CEO of SITA Ntutule Tshenye said: “SITA has engaged with Altron Nexus to resolve this emerging tension from SMMEs to ensure this risk is mitigated, and that the matter is resolved in an amiable manner. The SMME concern around competitiveness, compliance and payment is being taken seriously, noting that SITA’s contractual agreements are explicit and unambiguous.”

He added that SITA had also received full assurance from Altron Nexus on its commitment to the highest principles of integrity within this process.

“SITA has engaged with Altron Nexus, who has given their full assurance in the spirit of openness and transparency on this crucial matter. They are prepared to open the process for auditing. This would include the records used in the SMME vetting process. This transparent approach to the work done to date on this programme will assist to build confidence in the lifecycle of this programme,” Tshenye said.

He added that SITA believes Altron’s leadership and its management, “who are aware of the concerns raised, will continue on the intention to build and foster good ethos and interaction between itself and SMMEs”.

Proof of payment

On Tuesday, Altron Nexus submitted the project delivery report to SITA as well as proof that the SMEs had been paid.

Tshenye said SITA will continue to engage with Altron Nexus on the process of tender spend and payments to this SMME sector.

Responding to the allegations, Altron Nexus spokesperson Zipporah Maubane said the Gauteng Broadband Network project phase two was awarded six months ago and is at its initial rollout stages, with 15 sites allocated so far. She said 79% of the work on these 15 sites had been allocated to SMMEs, which is “significantly higher than what was required contractually”.

She added Altron had appointed five project houses, of which four are level one BBBEE, despite the SMEs claiming this was not so. The SMEs originally claimed Altron preferred to appoint companies it had worked with in Limpopo and Tshwane.

Maubane said 79% of the work on the 15 GBN sites had been allocated to SMMEs, which “is significantly higher than what was required contractually”.

Nkomo-Ralehoko’s communications team said she will only be available for an interview after the department’s budget vote in two weeks’ time.

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