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By Anna Majavu | Dec 22, 2009 | COMMENTS [ 0 ]

THE Eastern Cape provincial government has cancelled a R3,9billion fleet management tender linked to the controversial Bosasa group of companies.

The tender was awarded to Phakisa Fleet Solutions, which is a subsidiary of Bosasa, under controversial circumstances.

Last month Bosasa was exposed for allegedly bribing top prison officials to secure contracts worth more than R1,7billion.

A report by the Special Investigating Unit released in Parliament revealed that one Correctional Services official allegedly accepted a house, cars, an overseas trip for his daughter and rugby season tickets to watch the Blue Bulls in exchange for awarding tenders.

The company, which was repeatedly defended by former Correctional Services minister Ngconde Balfour, received tenders worth close to R2billion for services in IT, security and prison meals, and in some cases it allegedly wrote tender specifications.

Last month Sowetan reported that Auditor-General Terrence Nombembe agreed to investigate the R3,9billion contract given to Phakisa to manage the Eastern Cape province's 2900 car fleet.

This after a competing bidder, Makhubu Consortium, threatened to interdict the provincial government after discovering that Phakisa's R3,9billion bid was about R800million above the limit set by the provincial government.

The Makhubu Consortium bid was much lower at R2,6billion yet failed to win the contract.

Yesterday three different sources close to the bid confirmed that the Eastern Cape transport department had cancelled Phakisa's contract last week. But the government was trying to keep the decision secret.

Cope member of the provincial legislature's transport committee John Korkie confirmed the cancellation.

He said the transport committee had not been officially informed "but we know that government sent a letter to the losing bidder to say they must stop their legal action now that they have cancelled the contract".

"The contract was cancelled as a way to deal with the Makhubu Consortium's legal action. As members of parliament, we are still waiting for the Auditor-General to tell us why Phakisa won the contract in the first place," Korkie said.

Makhubu Consortium's lawyer, Lionel Egypt of Cliffe Dekker Hofmeyr Attorneys, also confirmed that government had cancelled Phakisa's contract.

Provincial legislature transport committee chair, Xolile Nqata of the ANC, confirmed that the contract was cancelled.


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