City of Cape Town's procurement processes face scrutiny amid tender allegations

The GOOD Party has challenged the City as it defends its procedures pertaining to a multimillion-rand contract for video display screens at Cape Town Stadium, calling for transparency to ensure public confidence.

A public dispute over the awarding of the multimillion-rand contract has shifted the spotlight onto transparency in municipal tender processes.

The City said it rejected the allegations of fraud and corruption made by what they called an unhappy unsuccessful bidder. " 

"The unsuccessful bidder had also been advised to challenge the decision in court for further public and transparent scrutiny as the City followed all due process," the city said.”

The debate follows social media posts by Frank MacBeath raising concerns about the disqualification of a lower-priced bidder and the subsequent awarding of a higher-priced contract. The posts reference Sport and Traffic Technologies (Pty) Ltd (SATT), which submitted an unsuccessful bid and maintains it had offered a compliant proposal of about R27 million. According to MacBeath’s posts, the awarded contract was valued at approximately R46 million.

MacBeath wrote that the bidder was excluded over what he described as “a minor clerical drawing dimension discrepancy” and “a rate-only item that does not affect the tender total”. He further stated that “no risk analysis was conducted”, arguing that the decision was inconsistent with procurement principles requiring fairness and cost-effectiveness.

The City issued a statement rejecting it. The City’s Chief Financial Officer, Kevin Jacoby, said: “The City recognises the importance of public confidence in supply chain management. It therefore reiterates that it applies a procurement system that is fair, transparent, competitive, and compliant, and it will continue to act decisively against any substantiated wrongdoing.”

The City said the tender had been advertised more than once, with the first process cancelled after no responsive or acceptable bids were received. In the subsequent process, six bids were submitted and five were found non-responsive. One bid was deemed responsive and awarded the contract. An internal appeal in terms of Section 62 of the Municipal Systems Act was dismissed.

Brett Herron, Secretary-General of GOOD, said the legal safeguards governing procurement are already contained in legislation and Treasury directives, but that transparency is essential to ensure public confidence.

Herron said that bid adjudication processes in Cape Town had previously been open to public observation and suggested they should be fully accessible.

“If they aren’t then they must be reopened so that the bidders and the public can observe the administration’s engagement with the bids in real time. This is the best way to ensure that bid evaluation and adjudication processes are conducted with honesty, objectivity and in terms of the safeguards already in place.

 “All documents related to a tender or request for quotations should be publicly available,” he said.

On the question of forensic investigations, Herron said these should be triggered “whenever there is a credible allegation of maladministration or corruption in a tender process,” particularly if the Municipal Public Accounts Committee resolves that an investigation is warranted.

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