Suspect jail catering deal set to survive

The Department of Correctional Services has confirmed it is in talks about extending a R1 billion catering contract that the Special Investigating Unit found might have been corruptly awarded. At issue is the department’s inability to cater for inmates itself, despite national prisons boss Tom Moyane promising Parliament last year that correctional services staff would take over by this year. Bosasa Operations won its first multi-million rand contract to run prison kitchens in 2004. Since the SIU’s probe, its dealings with the prisons department have been under investigation by the Hawks.

Moyane’s spokesman, Phumlani Ximiya, confirmed that the department was in negotiations with Bosasa. He said the SIU report would be “strongly considered” when deciding whether to continue doing business with the firm. City Press reported on Sunday that four senior advocates, in a legal opinion requested by Moyane, had advised that Bosasa’s contract should not be extended for 18 months. The advocates advised Moyane on January 19 to advertise a fresh tender. “The legislative and policy framework is clear with regard to procuring goods and services for amounts exceeding R500 000,” they were quoted as saying.

Ximiya said: “No decisions have been made yet. We are looking at options (and) if it’s feasible for the department to further engage with the service provider. The department does not in any way support corruption.” DA MP James Selfe wants a commission of inquiry to probe the saga – as well as other dubious contracts. He said Bosasa’s first three-year contract, to provide “nutritional services”, was awarded “under highly controversial circumstances” in 2004 at an initial annual cost of R239 million. It was “administratively extended” to a number of additional correctional centres in 2006 (at an additional annual cost of R82m) without going out to tender.

Bosasa affiliates were later awarded contracts to provide access control and fencing at various prisons. The SIU found evidence of corruption in the way the initial catering contract was awarded. Former department chief financial officer Patrick Gillingham – who resigned last year before a disciplinary inquiry began – is understood to be facing criminal charges flowing from the SIU investigation. When the contract was due to expire late in 2007, then correctional services minister Ngconde Balfour insisted it be extended, causing a breakdown in his relations with then prisons boss Vernie Petersen.

Petersen, who has since died, was abruptly transferred to become the director-general of sport. Selfe said that at the end of 2008 the contract was re-awarded to Bosasa for another three years, despite other companies having submitted cheaper bids. “I reported this matter to Scopa (the parliamentary spending watchdog) at the time, and the Department of Correctional Services has failed to provide a coherent explanation as to why it decided to award the contract to Bosasa,” he said.

Selfe said the “saga has so many inexplicable features and unanswered questions” that the DA wanted “a full commission of inquiry into the award, re-award and extensions of the Bosasa catering contract, as well as the contracts awarded to Phezulu and Sondolo IT, and the relationships between these companies and Balfour, and the former national commissioner, Linda Mti”.