The SA National Roads Agency Limited (Sanral) has defended its decision to award a R4.7bn tender to a company whose directors are facing fraud and corruption charges.
This, the road agency says, is because there is no law prohibiting it from giving contracts to criminally charged persons or companies who are yet to be found guilty.
Last month, Sanral awarded the tender to upgrade a 6km stretch of road along the N3 – from Westville Viaduct to Paradise Valley interchange – to a joint venture including Aqua Transport and Plant Hire, a company whose two directors are facing criminal charges related to allegations of defrauding the KwaZulu-Natal department of transport of more than R1.6m.
The directors, Elaine Naicker and Vasuthevan Naicker first appeared in court in September last year alongside Donovan Naicker – a former director of the company and engineer Stephen Cahi.
A company search by Sowetan showed that Donovan resigned as a director in 2021.
The tender is a joint venture between Aqua and EXR Construction and is set to take 51 months to complete.
Its award to the company has raised eyebrows with the Organisation Undoing Tax Abuse (Outa) saying it has submitted a Promotion of Access to Information Act application after they were approached by a whistleblower.
However, Sanral eastern region engineer Andrew Ssekayita said the agency would be legally challenged as they could not use the criminal charges as a reason not to award the tender to Aqua.
“The due diligence report picked up that they [Aqua directors] were facing fraud charges but have yet to be found guilty and convicted,” said Ssekayita.
He said the tender was put through an evaluation process where the company complied with tender requirements and scored the highest evaluation points.
The project involves the provision of additional one and two lanes over the full length of the project to create a varying 4-lane to 6-lane dual carriageway plus auxiliary lanes where required.
“It is a 50% split between venture partners and thus an integrated joint venture where resources and employees will be combined as well as share of profits and losses, according to their joint venture percentage split.
“The Aqua-EXR joint venture was awarded through a tender process where four tenders were received."
Work was scheduled to start on June 7, but Ssekayita said it had not commenced.
Aqua lawyer Reuben Naicker said they were not awarded the tender but were participants in a joint venture.
He did not answer further questions from Sowetan.
KZN Hawks spokesperson Cpt Simphiwe Mhlongo said Cahi allegedly inflated the plant hire hours, as a result, the provincial department of transport was defrauded R1.6m.
He said between 2010 to 2013, Aqua was awarded a plant hire contract to supply equipment to the upgrade of a road in Nongoma.
“A case of fraud and corruption was reported at Pietermaritzburg police station and the case docket was allocated to Hawks members of Durban Serious Corruption Investigation.”
The Naickers and Cahi were released on R10,000 bail each, he said. Mhlongo said they were due back in court on July 18.
Outa head of legal Stefanie Fick said Sanral should be committed to principles of ethical conduct when awarding contracts.
“In SA we are in need of ethical leadership and commitment to principles of ethical conduct,” said Fick.
She said though awarding the tender to Aqua might not be in contravention of the legislation, South Africans should expect a “big state-owned entity” like Sanral to also consider the conduct of the persons that they award contracts to.
“We all know that once you’re an accused, then you’ve a right in terms of the constitution that you’re innocent until proven guilty.
“Whether they are found guilty or not, shouldn’t one consider that when awarding a contract that you either have to wait until that [criminal case] is finalised if that is important to you. But surely there should be other organisations that can deliver the same quality of work without questioning their ethical conduct.”
The company was also the subject of an investigation conducted by the public protector.
In 2018, suspended public protector Busisiwe Mkhwebane released a report which found that Pikitup had improperly awarded and extended the contract for the supply‚ operations and maintenance of plant equipment to the designated landfill‚ garden sites and waste management depot to Aqua.
Pikitup spokesperson Muzi Mkhwanazi told Sowetan that on February 15 last year, the entity made a request to the national treasury to blacklist Aqua as per the outcomes of Mkhwebane's report.
Mkhwanazi would not answer further questions on whether the request had been implemented.
– Additional reporting Mpho Sibanyoni
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