The Special Investigating Unit (SIU) has reached a settlement to recover R25 million from companies and individuals linked to irregular school cleaning contracts awarded by the Gauteng Department of Education during the COVID-19 pandemic.
This follows a 2022 Special Tribunal ruling that set aside contracts worth R431 million, after an SIU investigation found that the GDE bypassed standard procurement processes.
According the SIU, service providers were chosen informally through referrals, WhatsApp messages, and supplier databases without approval from the department’s Supply Chain Management division.
The SIU said it has reached a settlement with service providers linked to the Chachulani Group Investment Holdings, including Muta Investment Holdings, Netvision Energy Savers, Mpale Investments Holdings, Naledzi Investment Trust, and several individuals associated with these companies.
It said the companies consented to repay a total of R25 million, with amounts ranging from R707,892 to R12.9 million being debited from their bank accounts. The settlement also requires the funds to be transferred to the SIU within seven days of the Tribunal’s order.
“The investigation revealed that the procurement process was not cost-effective, as service providers were not paid per square metre of the area cleaned. Rather, a senior official in the GDE appeared to have arbitrarily decided to offer a fee of R250 000 to R270 000 for the decontamination of primary schools; R250 000 to R290 000 for secondary schools; and R250 000 to R300 000 for district offices.”. the SIU said.
“The fees charged were not proportionate to the work performed by the service providers or the cost of materials used.”.
The corruption watchdog added that “the selection and appointment of service providers was done in a haphazard, unfair and inequitable manner contrary to the requirements in Section 217 of the Constitution. Senior officials involved in the procurement process also admitted that prescribed SCM procedures were not followed”.
“Meanwhile, the service providers have agreed to formally withdraw their appeal before the Johannesburg High Court. This settlement is a critical outcome of the SIU’s relentless efforts to recover public funds lost during the COVID-19 national state of disaster. The SIU remains committed to protecting public funds, restoring integrity in procurement, and ensuring that those who unlawfully benefit from state contracts are brought to justice”.
The SIU also said that it is “also empowered to institute civil action in the High Court or a Special Tribunal to address any wrongdoing uncovered during investigations related to corruption, fraud, or maladministration”.
“In line with the Special Investigating Units and Special Tribunals Act 74 of 1996, the SIU refers any evidence of criminal conduct it uncovers to the National Prosecuting Authority for further action”.
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