Minister Masutha blames SIU for failure to recover funds from Bosasa
Correctional services minister Michael Masutha has blamed the Special Investigating Unit (SIU) for his department's failure to recover money from Bosasa.
The SIU found in 2009 that department of correctional services officials had been bribed for Bosasa to score contracts worth millions. The SIU recommended that civil action be instituted against Bosasa to recover funds related to irregular contracts.
Asked why the department had not done so a decade later‚ Masutha said the SIU recommendation had lacked specifics‚ leaving them with no choice but to let Bosasa off the hook for a decade.
Briefing the media in Pretoria on Monday‚ Masutha said: "When I study the ... report of the SIU‚ it does not outline in what manner‚ in detail‚ was the state put out of pocket financially so as to determine the quantum that you would then want to recover.
"That is one of the challenges that we have because you must distinguish between procuring irregularly‚ rendering the contract unlawful therefore liable to termination and the civil recovery aspect‚ which can only be based on actual loss incurred."
According to Masutha‚ the department had received services that were equivalent to amounts paid to Bosasa‚ therefore there was no money lost.
"There is this notion of just and equitable. It (the SIU Bosasa report) has to be assessed on the basis of evaluating how much did you get‚ what value you get in exchange for how much you paid. So without that clear information it becomes difficult for one to institute civil recovery‚" said Masutha.
Masutha said the department did not blacklist Bosasa either but carried on doing business as usual because the SIU report did not make a recommendation in this regard.
"Perhaps in hindsight the department should have instituted blacklisting proceedings [against Bosasa] but blacklisting was not one of the recommendations of the SIU‚ according to my recollection.
"With the situation where you have not blacklisted a company it becomes difficult to legitimately exclude it from future procurement but blacklisting would have put a stop to continued procurement by a company which now‚ as we see in the Zondo commission‚ had dubious dealings."
Head of the SIU advocate Andy Mothibi said the unit on its own was not legislatively armed to recoup the funds from Bosasa but could only make recommendations to the department of correctional services.
"When you look at legislation regulating SIU business at the time of the Bosasa report‚ the SIU did not have legislative powers to institute civil litigation on behalf of state institutions on its own or jointly with the state institutions‚" said Mothibi.
"The SIU would have acted but that means [it] would have acted outside of the law‚ hence the recommendation was to the state institution in this regard to consider instituting civil litigation because contracts were irregular."