JOHANNESBURG - The South African National Roads Agency (SANRAL) has acknowledged that its R9.5 billion Routine Road Maintenance (RRM) tender has been tainted with lawlessness.
It said legal advice revealed that there had been procurement flaws in the appointment of contractors, so serious that the agency had "no credible prospect of successfully defending the award".
And, as such, it said it approached the High Court in Pretoria to seek an order declaring the tender award unconstitutional and unlawful.
This was revealed by the outgoing Chief Executive, Reginald Demana, during a media briefing on Tuesday.
During the briefing, he touched on procurement issues, including allegations of corruption and lawsuits currently in the public domain.
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According to Demana, SANRAL has been on the “wrong end of several court cases” owing to lapses in its procurement processes and practices.
He said that instead of spending tax money on litigation on a matter it would be unlikely to win, the agency agreed to a review application after consulting legal advice.
“SANRAL cannot, and will not, defend legal matters at all costs, particularly where it is apparent that material irregularities identified cannot be defended.
"Given the irregularities identified, and in an effort to ensure transparency and to remain accountable, SANRAL itself proposed to the Court, and the respective parties, that the tender is declared constitutionally invalid, reviewed and set aside,” he said.
The start and collapse of the tender
The RRM, which launched in 2024, was meant to appoint a panel of 20 contractors to maintain South African roads over a period of five years.
SANRAL said it had previously managed this work through approximately 251 contractors.
According to SANRAL, the new model consisting of a smaller panel would be “quicker and more efficient to procure and far less complicated to manage”.
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During the tender process, 401 tenders were received, and 20 successful bidders were recommended.
Tender cracks exposed
Problems began when two unsuccessful bidders challenged the procurement process. This led to internal investigations, which laid bare how the process was “materially flawed”.
The flaws, according to SANRAL, included and were not limited to, failing to comply with its own tender procedures after having failed to avail the tender opening register, as well as not opening the tenders at the tender box an hour before closing.
The tender also fell short of not evaluating bids on price as required by the law, but instead, the panel was appointed on functionality alone.
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SANRAL also conceded that there was prima facie information pointing to suspected fraudulent conduct at the agency
“This includes awards to companies that do not appear to exist, or whose addresses and contact details cannot be traced – alongside serious irregularities throughout the bid specification, evaluation and adjudication process,” the agency revealed.
Reform action
SANRAL said in light of the procurement breaches that have happened, it was pursuing reforms.
“Tender opening will be made public. Internal Audit will provide assurance on the pro-formas and will also review some tender awards on a risk-based basis,” the agency said.