Cancelled computer project to cost R200m

After paying over R3 billion on equipment that the Gauteng government does not own, taxpayers will still have to pay R200 million more to the company that set up computers in the province’s schools. The R200m is on top of the estimated monthly R30m that the Gauteng Department of Finance will have to pay SMMT Online – the company that runs the programme – to continue its services until the Gauteng Online project is incorporated into a new broadband initiative. Earlier this week Finance MEC Mandla Nkomfe said the multi-billion-rand Gauteng Online project – the largest school computer project in the country – would effectively be cancelled and integrated into the Gauteng Broadband Network (GBN).

The broadband network is a separate project in which the provincial government plans to connect all its departments and communities to a central telecommunications network across the province via 1 600km of high-speed fibre. Despite the cancellation of the five-year-old project, the finance department still has to pay SMMT Online R200m. But Gauteng Department of Finance spokeswoman Desiree Ntshingila this week told Independent Newspapers that the R200m was “historical arrears” and not a cancellation fee. She would, however, not provide details on the historical arrears. SMMT Online’s chief executive James Ainslie said: “We are not allowed to speak to the press directly. We are happy to assist with any information but you’d have to go through the Gauteng provincial government first.”

But Independent Newspapers understands the money dates back to services rendered for the Gauteng Online project last year. The department came under the spotlight last April after it emerged that it owed service providers R167m in rental and service level agreement payments. At the time Nkomfe denied that the service providers were owed money. But a source in his department, who did not wish to be named as they were not designated to speak to the media, said that at the time of the scandal the department had reached a compromise with the service providers to continue working and that they would be paid at a later stage. That payment had, however, still not taken place, said the source.

Earlier this week Nkomfe said SMMT would provide the Gauteng Online service until the project was integrated into the GBN. Nkomfe said this would not take longer than two months. But the source said the tender was still in its adjudication phase, which would take longer than two months. The tender for the Gauteng Broadband Network was advertised at the same time that the Gauteng Online tender was re-advertised. The Gauteng Online tender aimed for the successful bidder to take over operations from April 1, according to the tender’s request for proposal.

The successful bidder would have had to ensure that there was no interruption to services in the project – despite the fact that SMMT Online owned the computer equipment, including all computers, the entire network and source codes, and any company that won the tender would either have had to buy all the equipment from SMMT or start from scratch. The Gauteng Online project was launched in 2001 to enable every public school in Gauteng to have a functional computer lab, allowing pupils to be computer literate by the time they left school. But the project has been mired in controversy – and 11 years later over 600 of the 2 200 schools in the province still do not have computer labs. In February, when Nkomfe tabled his budget, he set aside R15m over the next three years to establish and operate the project management office for the province-wide broadband project.