SIU probes prison IT contracts

By Leon Engelbrecht, ITWeb senior writer

Johannesburg, 05 Mar 2008

Advocate Willie Hofmeyr`s Special Investigating Unit (SIU) is probing a range of contracts involving the Department of Correctional Services (DCS). These include IT contracts said to be worth several hundred million rand.

The department last week acknowledged to Parliament that its procurement system was plagued by corruption and maladministration. The Parliamentary Monitoring Group reported that Prisons commissioner Vernie Petersen told the Correctional Services Portfolio Committee that the SIU had already helped the department recover R3.4 billion. That includes R8 million in the 2006/7 financial year, largely linked to medical aid fraud committed by prison warders and medical practitioners.

Petersen added that the SIU had its commission renewed in November last year and was now also investigating a number of procurement contracts.

The SIU says this investigation is being done in terms of Proclamation 44 of 2007. The unit says in a statement the DCS is "reviewing its procurement division to assess the sustainability of a number of contracts, as well as the regularity of the procurement process itself".

"This review is based on a forensic audit conducted late last year, and information in the department`s possession."

Other than IT contracts, the SIU`s forensic audit related to a number of repair and maintenance projects, as well as contracts related to food supply, clothing, building and security. The SIU was created in the 1990s to fight corruption and was long known as the "Heath Unit" after its founding head, then Judge Willem Heath.

Complaint lodged

Newspapers Mail & Guardian and Beeld have linked several of these contracts to Bosasa, an unlisted BEE company with IT, security and building interests. The papers alleged that Bosasa subsidiary Sondolo IT had scooped three contracts "with a combined value of more than R700 million" in 2005 and 2006.

The M&G added that Beeld reported in 2006 that Sondolo had written "large portions" of a tender that it later won" and that these contracts were among those under SIU review.

But the SIU would neither confirm nor deny this. "At this stage the SIU is not targeting any specific company. The unit`s goal is to assist the DCS to ensure the regularity of their procurement process," the watchdog says.

This response, however, vexes Bosasa. "...our attorneys have written to the SIU to enquire of them whether Bosasa is being investigated and, if so, we have tendered our co-operation and, if not, for them to say so, as these ongoing unsubstantiated allegations are causing our business financial harm," Bosasa communications director Papa Leshabane says.

He adds that the company has lodged a complaint with the Press Ombudsman "regarding the defamatory and inaccurate nature of the M&G article. In addition our attorneys have drawn to the attention of the M&G the defamatory nature of the article calling on the M&G to desist in publishing defamatory material of Bosasa".

M&G reporter Adriaan Basson, who also wrote the 2006 report in Beeld, stands by story. "The Mail & Guardian has received Bosasa`s complaint and is in the process of preparing a response."