Friday, March 1, 2024

Deputy Permanent Secretary and Tender Committee to be investigated for corruption

A high-ranking Ministry of Finance and Development Planning official and five members of the ministerial tender committee (MTC) will soon be explaining to the Directorate on Corruption and Economic Crime investigators how a multi-million pula tender was won by a company that should have been disqualified from the get-go.

Concluding his judgement in a matter in which he found procurement law to have been seriously contravened, Justice Dr. Zein Kebonang directed the Directorate on Corruption and Economic Crime (DCEC) to investigate Jacob Momene, MFDP’s Deputy Permanent Secretary (Corporate Services) and five members of the MTC being Leungo Mhaladi, Sebetso Tlhabuse, Julia Abram, Felicity Bogacu and Eric Johane.

The tender is in respect of office accommodation for the Accountant General, an MFDP department, and features two companies: Zambezi Motors and Varsha Enterprise. While it ended up being recommended as the preferred bidder, Zambezi offered office space priced at an “above-market rate” and that didn’t meet other tender requirements. Additionally, the buildings had numerous defects that were uncovered by a fit-for-purpose inspection. Conversely, while it ended up losing the tender, Varsha met all the tender requirements. In addition to office space measuring between 9000 and 11 000 square metres, the invitation to tender (ITT) called for “about 400” parking bays. Varsha offered close to 400 bays while Zambezi could only provide “about 300.” What emerged during the hearing a fortnight ago was that Bogacu gave Zambezi a score of 40 on parking space and Varsha 32. Abram scored the companies 35-30 in favour of Zambezi. The latter company ended up being recommended as the preferred bidder and Momene wrote it a letter proposing that it should reconfigure its bid.

In a section of the judgement sub-titled “Potential Acts of Corruption”, Justice Kebonang says that Momene “seemed to have more than a casual interest” in the tender. To be clear, the Public Procurement and Asset Disposal Act provides for communication between the procuring entity (MFDP in this case) and a bidder but only when there is some “ambiguity” that needs to be cleared up. Describing this action as “distortion and manipulation of the process” because there was no ambiguity, the judge found that while it was written under the guise of seeking clarity, Momene’s letter was in effect, negotiating material terms of the tender. The Act expressly forbids negotiation of such terms after the tender had closed. To back up his point about bias in favour of Zambezi, Kebonang said that no clarification was sought from Varsha.

For those who attended the hearing two weeks ago, this ruling will not come as a surprise. Then the justice asked the two South African advocates in the matter (John Peter for Varsha and Schalk Burger for PPADB) about the propriety of referring the matter to the DCEC. Earlier he (Kebonang) had bluntly stated that the case “smelled of corruption” and repeatedly questioned Momene’s actions. While Peter said that it was within the judge’s remit to make such referral, Burger maintained that such action would be improper because there was no application for such referral in the first place. Ultimately, it was Peter’s argument that carried the day.

 Typically the DCEC initiates its own investigations but this is a rare case in which the High Court is directing it to shine a light on murky corners of a suspect tender.


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