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#StateCaptureInquiry: 'State entities abused procurement processes'

IOL / 21 AUGUST 2018 - 14:03 / ZINTLE MAHLATI

Johannesburg - National Treasury official Willie Mathebula has painted a grim picture of the abuse procurement processes by some government departments and entities.

Mathebula said there were instances where some government entities used the deviation clause to circumvent procurement processes which would essentially allow them to award the tender to whomever they chose.

The first witness called to the commission, Acting Chief Procurement Officer at National Treasury Willie Mathebula. Picture: Karen Sandison/African News Agency (ANA)

He was testifying at the second day of the commission of inquiry into state capture on Tuesday in Joburg.

Mathebula has worked at National Treasury for 17 years and was appointed by then finance minister Malusi Gigaba in September 2017 to act as the national chief procurement officer.

The Treasury official spent the buckle of his morning testimony explaining the procurement processes at Treasury. He was lead into explaining his supplied statement by Advocate Leah Gcabashe.

Mathebula explained how a clause in Treasury regulation, which is meant to assist government entities in emergency situations, was abused. He did not mention any specific state entity in his testimony.

The Treasury had to even issue multiple notices to government departments outlining how the deviation process worked, which were new processes that were in place to deter abuse.

“Deviations are actually allowed. There are instances where organs of state are actually allowed to deviate from procurement processes. But there are instances where it must be for specific emergency cases for life-threatening situations. Where you cannot be expected to go out for a competitive process for months for a tender. That’s how we describe a deviation,” said Mathebula.

“We then picked up pockets of this abuse of this regulation and we issued an instruction to say if you deviate from normal processes and the transaction is above a million it must be reported to the Auditor General within 10 days. But this thing went on and we issued another notice,” he said.

After numerous notices, the abuse of the deviation process still continued and in some circumstances becoming the “norm”.

“In 2016 there was another instruction we issued. This instruction highlighted the same principles.

This one went a step further and said any other deviation outside of the processes must be approved by provincial and national Treasury. We wanted the processes to be transparent.

“There were unintended consequences, instead of deviations being in certain circumstances, deviations became the norm. Organs of state instead of complying with regulations saw a room to use deviations to circumvent rules,” said Mathebula.

“This continued in that, for example, you would find a contract worth R4 million and by the time you know it the contract value is sitting at R200 million. How is this possible?”

Mathebula said there was a procurement bill that will be introduced which will assist in tightening the belt on the abuse of procurement processes.

“There is a public procurement bill that will be a national overarching regulation instrument to deal with all these other legislation. So some of these small pieces of legislation will be repealed and some amended to make sure that we have one piece of legislation in the country that deals with procurement,” said Mathebula.



Disclaimer - The views expressed here are not necessarily those of the BEE CHAMBER

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