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City of Joburg to face court action if it ends controversial R1.2 billion tender deal

The contentious R1.2 billion fleet tender could result in the City of Joburg being hauled to court should it terminate the contract ahead of its schedule as advised by the National Treasury.

This was the vow made by Afrirent, the company at the centre of the alleged tender corruption case. Senzo Tsabedze, the chief executive at Afrirent, maintains that his company had acted within the prescripts of the law when it received the contract in 2018. Treasury director-general Dondo Mogajane issued a directive to the city in April for it to review the Afrirent contract.

Afrirent is contracted over a 30-month period to provide more than 2700 vehicles to the city, and Tsabedze said the deal would lapse in 11 months’ time. Should it be eliminated before then, Tsabedze added, Afrirent would have no option but to approach the courts. “We will consider legal action, because our view remains that we were appointed using Regulation 32 of the Municipal Finance Management Act (MFMA), and we did things accordingly,” Tsabedze said.

Regulation 32 of the MFMA allows a municipality to procure goods under a contract already secured by another organ of state. At the time of receiving the contract, Afrirent had a similar deal with Mogale City municipality to also supply it with leased vehicles. “We believe that the Treasury was misled and given wrong information, because the Mogale City and City of Joburg contracts are similar,” Tsabedze said.

He took issue with the fact that the Treasury issued the directive for the tender to be reviewed without it engaging with Afrirent before doing so. However, the Treasury told The Star that they were not obligated to have approached Afrirent. Mlimandlela Ndamase, spokesperson for Joburg mayor Geoff Makhubo, confirmed that the mayor received the directive from the Treasury, and that the city had responded to it on April 28.

Afrirent gained infamy in 2018 after The Star reported it would receive a contract which would cost Joburg R700 million more than its previous fleet tender for half the time as the city's previous vehicle agreement.

Source: www.iol.co.za
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