Gauteng pays R3bn for consultants

Gauteng government departments and their agencies have spent more than R3 billion on consultants. The Gauteng Department of Finance is the worst offender of the 12 departments, having spent more than R1.3bn on consultants. This information emerged in the replies of all Gauteng government departments to questions asked by DA spokeswoman on public accounts Glenda Steyn. Steyn asked the departments to give details of all the consultants and companies paid by them during the 2010/2011, 2011/2012 and 2012/2013 financial years. Steyn said the total spent by all these departments and agencies was R3.2bn. She said the actual figure could be more than R4.5bn because several departments had failed to provide information for the 2012/2013 financial year.

The Gauteng Department of Finance under MEC Mandla Nkomfe in its reply listed only eight companies contracted, and all of them were collectively paid more than R1.3bn over two years. Nkomfe told Steyn that FirstRand was paid R1bn in two separate payments of R500 million each for the failed Gauteng-On-Line projects in various schools in the project. Other companies were paid less than R50m in each financial year. Finance was followed by the Gautrain Management Agency, which paid its consultants more than R795m over the past two years. The Gauteng Department of Roads and Transport spent almost R700m. Community Safety spent the least of all departments – R3.4m. The Department of Sports, Arts, Culture and Recreation paid out R5m.

“The DA in Gauteng believes that the large bill for consultants is indicative of a lack of capacity and adequate skills development and retention within the provincial departments,” Steyn said. She said that earlier this year, Deputy Auditor-General Kimi Makwetu had called on the government to “immediately implement stricter controls to get the best value for money for services provided by external consultants to the public sector”. Steyn said Makwetu had warned that inadequate planning, high turnover of employees in key positions, inadequate financial and performance management, and ineffective governance adversely affected the use of consultants. “I will request that the Gauteng legislature’s standing committee on public accounts (Scopa) conduct an investigation into the use of consultants by the provincial government and its entities.

“I will also question Premier Nomvula Mokonyane on the interventions her government has undertaken in support of the Auditor-General’s recommendations,” she said. Steyn said it was imperative that Scopa probe irregularities in the use of consultants and determine whether the people of Gauteng were receiving value for their money. Some of the payments:

• Afrovation Investments was paid R20 393 859 for collaboration services.
• Baraka IT Solutions received R3 293 112 for SAP reconfiguration.
• Deloitte & Touche was paid R11 311 851.20 for transaction advice.
• EOH Mthombo received R1 727 943.88 for Gauteng provincial government contracts management.
• FirstRand Bank received two payments of R500 million for Gauteng Online.
• G-Soc Security Services received R45 373 665.70 for Gauteng provincial government IT security.
• LNE Msikinya t/a Mdlulwa Nkuhlu Incorporated was paid R3 112 200.40 for legal services.
• Moodie & Robertson Partnership was paid R146 874.75 for legal services.