Issued by: North West Communication Service
The aim of this statement is to inform the public about the findings of the commission instituted by myself and my department into unauthorised expenditure.
After discovering serious prima facie anomalies in the purchase of communication equipment for the departments of Health, Transport and Public Works, I requested the Provincial Treasury to immediately institute an investigation into the anomalies.
This investigation was led by an independent firm of accountants outside of government.
The terms of reference were, among others:
- To investigate whether all the equipment purchased had been supplied; - To probe any mismanagement or irregularity regarding the contract approved by the North West Tender Board; - To investigate whether the provincial government was overcharged on the contract; and, - To investigate whether there was any misconduct on the part of officials or the contractor.
It also had to make recommendations to prevent future occurrence of similar nature.
The department is now in possession of the interim report and the following can be revealed;
a) There has been unauthorised expenditure on a tendered contract, which was originally worth R126 900; b) The unauthorised expenditure so far amounts to about R11,7 million for the supply, installation and maintenance of the radio equipment for the departments of Health, Transport and Public Works and Roads; c) The commission has identified the whereabouts of the equipment. Some have been installed while others are yet to be installed. All the equipment, however, have been delivered and remain in safe storage under the control of the Department of Public Works and Roads. d) The subsequent amount was affected without approval of the Provincial Tender Boards; e) Certain officials involved in the purchase of the equipment acted outside of their authority; and, f) Proper procedures for effecting payment for the equipment and its supply were not followed. g) There are outstanding orders for equipment and accessories valued at about R8 million, excluding VAT. If the provincial government was to honour these orders, the amount would then reach about R20 million. However, this would depend on the needs of the provincial government.
The information at this stage indicates there has been disregard of financial regulations.
I have ordered further investigations to assess if there has been any fraud and to look at what possible action can be taken against officials concerned. This includes officials in the departments of Transport, Health and Public Works and Roads.
To this end, an investigating officer has been appointed in terms of the Public Service Act (1994) to pursue the matter further and departmental disciplinary charges will be laid in a few days.
You will be informed of the nature of the charges in due course.
23 July 1996