Cape Town loses beach tender case

The City of Cape Town’s procurement practices have come under fire, after the Western Cape High Court found city officials “erred” in the awarding of a three-year beach cleaning tender worth about R5 million. The city awarded the contract to clean 16 beaches from Gordon’s Bay to Melkbos to Khazimla Cleaning and Gardening Services earlier this year. But Beach Clean SA, one of the eight respondents to the tender call, has more than 14 years experience. Yet, it was penalised during the bid adjudication process because it did not provide prices for waste removal on all of the beaches.

Beach Clean SA challenged the city’s decision to award the tender to Khazimla, saying it had not been properly consulted by the city. Rogerio Viana, of Beach Clean SA, also contended that Khazimla’s tender bid was irregular as its pricing was modelled on his company’s confidential price structure. In his judgment, Judge AP Blignaut said the city should have asked Beach Clean SA about its pricing omission, and explained that this could render its bid non-responsive. He ordered the city to set aside its decision and to re-evaluate Beach Clean’s bid. But Cope councillor Jacobus Krynauw said this case should be investigated further, as it had cost the city and the ratepayers close to R2m in litigation costs.

“The idea is that councillors as the custodians of the ratepayer need to avoid unnecessary expenditure. Nothing was done to prevent the process from going to the point of litigation. This was a total waste of taxpayers’ money,” said Krynauw. Krynauw said he had written twice to mayor Patricia de Lille, and city manager Achmat Ebrahim. But instead, senior management had “passed the buck at the cost of the ratepayer”. Deputy mayor Ian Neilson said: “It is true that the mayor and city manager received the allegations of possible corruption and these were investigated by the city’s forensics department, who could not find evidence to that effect. It is notable that the applicant backed away from these allegations in court when the city presented its own evidence in that regard.

“There is no evidence of the need for any commission of inquiry into the matter. The issue is simply how incomplete tender documents are to be handled in future. The city will take note of the judgment and put in corrective measures…” Viana said the matter pointed to a “structural management issue” and that the city had to review its narrow consideration of tender bids. In court papers, Viana said the city could have asked him to explain why he had left out some prices with a “simple request”, via e-mail or telephone. Viana was also concerned that the successful bidder had little experience of beach cleaning, and would, in fact, outsource to a third party. But Neilson said the beaches were cleaned primarily by city staff and that the tender was only for a “limited, backup and specialist service”. The city had its own deep-cleaner machine.

“The city respectively disagrees with some of the judge’s decisions in this case, but on purely commercial considerations thought it better to simply comply with his instructions rather than to seek an appeal.” He said the city would evaluate Beach Clean’s tender, as ordered by the court. But he rejected Beach Clean’s assertion that it was the most experienced of the two bidders. The city is expected to make its decision and award the tender this week.