A major R7-billion government construction project in KwaZulu-Natal has been suspended following a Pietermaritzburg High Court ruling that found the tender process failed to comply with National Treasury regulations.
Dr. Vish Govender, Head of Department for KZN Public Works and Infrastructure, confirmed the project—which aimed to consolidate all provincial government departments and the legislature under one roof to reduce rental expenditures—was approved under the previous administration but has now been set aside due to serious procedural irregularities.
According to Dr. Govender, the department discovered that the R7-billion bid had been awarded to a company that did not comply with Treasury Regulation 16 or the Public Finance Management Act (PFMA). Upon assuming accountability, Dr. Govender and MEC Mayor first attempted to engage the awarded company in May of the previous year to address the compliance defects.
“When we did that, the representatives from the company refused to oblige, and hence we had to go the legal route,” Dr. Govender stated. “It was one of the greatest and toughest decisions we ever had to take since our appointment because you had to overturn an administrative decision taken by the government that we serve.”
The department approached the court to demonstrate why the former accounting officer’s award was flawed and to safeguard public assets and finances. Both National Treasury and Provincial Treasury subsequently concurred that the bid contained grave errors and required review.
Questions Around the Awarded Company
Dr. Govender outlined several concerns regarding the company that received the award. The entity was a joint venture involving a company based in the United Arab Emirates. However, discrepancies were identified between the company listed on the tender document and the entity registered on the Central Supplier Database (CSD), with only the latter being tax-compliant.
Furthermore, when the department requested financial guarantees to ensure the company could execute a project of this magnitude, cross-referencing revealed the South African entity’s experience was limited to fencing, security, and small maintenance work.
“To undertake a project of R7-billion, we realized that the company from the United Arab Emirates was brought in purely to justify why this particular company could then be given this award,” Dr. Govender explained, noting that while terms like “fronting” require formal investigation, a layman’s assessment raises serious questions about the consortium’s capacity.
Accountability and Next Steps
Internal disciplinary charges were brought against the former accounting officer responsible for the award. However, the individual resigned before the matter could be heard by a tribunal. Dr. Govender confirmed that the MEC and department have referred the matter, along with other related issues, to law enforcement agencies.
“The investigations are at an advanced stage, and we are confident that the law will take its course,” Dr. Govender said, adding that the criminal investigation proceeds independently of internal disciplinary processes.
Dr. Govender also confirmed that no funds were disbursed to the company before the project was halted. “Without fear or favor, not even a single cent was spent or paid out to this particular company,” he affirmed.
The department now faces the task of re-evaluating infrastructure plans within the context of the upcoming budget while continuing to address pressures around provincial office accommodation. Dr. Govender emphasized the administration’s commitment to regulatory compliance and accountability, aligning with broader public expectations for transparency in state procurement.