WATCH | ‘I am fearing for his life’: MP says about SITA head after flawed R1.2bn Western Cape tender

MPs want the State Information Technology Agency (Sita) scrutinised over a R1.2bn tender it facilitated for the Western Cape education department after a forensic report found it undertook a flawed tender process.

Communications and digital technologies minister Solly Malatsi appeared before parliament's communications committee on Friday after the tabling of a forensic report from Cliffe Dekker Hofmeyr (CDH), a law firm that investigated the tender. 

The forensic report probed the procurement processes followed by Sita for the supply of computer networking equipment, ICT hardware and network support services for five years.

It flagged four irregularities in the tender awarded to Blue Networks Consortium (BNC). The company was awarded the tender despite having two different pricing options for the same service. The law firm found this was irregular. Out of the 11 bidders, only BNC responded with two pricing options.

The company also failed to meet the requirement that 90% of electrical cables must be from a local producer. Sita also unfairly disqualified one of the bidders, Dimension Data.

The entity also did not get the number of votes required from its board to recommend the tender winner.

“The voting did not meet the minimum threshold of 70% as prescribed by Sita's MOI [Memorandum of Incorporation]. This means that Sita did not comply with its own governance processes,” the forensic report read.

The investigators recommended the board re-evaluate its decision on the R1.2bn tender.

Sita acting MD (AMD) Simphiwe Dzengwa told parliament he had not implemented the forensic report recommendations because the current board, which was previously dissolved, had not given him instructions.

“I started at Sita in February, the two gentlemen [company secretary Tendai Mphaphuli and supply chain management (SCM) head Kenneth Pillay] who were suspended [for tender irregularities] were already under suspension. 

“When there were changes [September] at a board level then there were questions about the decisions that were taken by the previous board led by Pillay [Kiruben] and whether I still hold the mandate to run the disciplinary process.” 

Dzengwa said the board had not yet given him a mandate to continue disciplinary processes for the tender blunder. Instead several suspensions in the company were lifted by the board, he said. While Pillay and Mphaphuli are back at work, charges against them have not been withdrawn.

“The matter is in limbo. A resolution was taken that the suspension must be lifted of the company secretary and head of SCM by the board. Besides the two suspensions there are a couple of suspensions that I have been instructed to lift. Two of them are also officials at SCM. I was investigating these officials, no report was asked from me,” he said.

“Unfortunately I feel that, I am in line because I have seen emails circulating saying that I must be suspended because apparently, I am not executing some of these instructions [from the board].”

Sita has spent about R5m in disciplinary processes, he said.

Sita was stuck between a rock and a hard place. Dzengwa raised concerns about cancelling the unlawful tender saying it could be regarded as fruitless expenditure by the auditor-general.

Shocked, Malatsi said he was hearing for the first time some of the things Dzengwa had told parliament. 

“It is concerning the AMD submission now infers there are plans to suspend him,” Malatsi said.

DA MP Tsholofelo Bodlani said she feared for Dzengwa’s life. 

“As the acting MD was speaking, I had chills down my spine and part of me felt like I was fearing for his life, because if you are going to be a hindrance to people who think they can loot the state then you are a moving target. Unless we nab and put an end to this, we will not succeed,” she said. 

“There is deep-rooted corruption at Sita. There is deep-rooted maladministration and corruption and delinquency. I would love it whether as myself or the committee that we institute an inquiry into Sita because what we are hearing here could be the tip of an iceberg.” 

Sita board chairperson Makano Mosidi defended the board saying that Pillay and Mphaphuli were reinstated after winning several legal cases against their suspensions by Sita last year. 

“I want to respond to the MD so that the members do not think we are rogue and that we do not care. We care deeply. Before we were unlawfully dismissed [in 2023] we had already started investigating this particular tender. As we were about to start minister [Mondli] Gungubele withdrew it.    

“We found the CDH report written draft, we thought it is a work in progress. As a board we got a legal expert to help bring everything together [and have a final report]. The corruption is inside and outside Sita. We know that,” Mosidi said. 

She said the board hired a law firm to complete the forensic report and thereafter the entity would start disciplinary processes.

“The idea is not to cancel this investigation but to make it complete and make it fair. So that when we move we do not leave those corrupt walking in the streets and those innocent being punished.” 

An internal report found the appointment of the acting MD by a previous board was unlawful. 

“We received a letter from the public protector saying Sita appointed the AMD unlawfully. [An internal report] found the appointment was unlawful. I was not aware of [rumours] of a suspension. How do you suspend an acting MD whose contract is ending in January? That would be silly. We must not chase the rumours because they will dilute the truth we are chasing.”

Committee chairperson Khusela Diko implored minister Malatsi to draft his response as to what decision he will take on the unlawful tender. 

“We hope this is one of the cases that will require your urgent attention. Please go and reflect on the actions you are to take,” she said.

The committee decided it would have a meeting to discuss the report and conduct an oversight visit at Sita.

WATCH full parliament committee meeting: