After a two-year battle, a small non-profit is victorious as the Pretoria high court sets aside all 11 contracts in government’s flagship jobs programme.

UPDATE: R13bn Community Work Programme declared ‘constitutionally invalid and unlawful’

CWP workers marched to the Cogta Headquarters in Pretoria in June 2019.
CWP workers marched to the Cogta Headquarters in Pretoria in June 2019.
Image: SUPPLIED

It has taken two years, but a small non-profit, Seriti Institute, has finally won its battle to set aside all 11 contracts in the R13-billion Community Work Programme.

In 2018, Seriti took the department of cooperative governance and traditional affairs (Cogta) to court after Seriti lost a tender to be appointed as an “implementing agent” for the job creation and poverty alleviation initiative.

Implementing agents run the programme on the ground on behalf of Cogta.

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On Friday, the Pretoria high court declared the procurement process “constitutionally invalid and unlawful” and set it aside.

“I am satisfied that there is no evidence of fairness in the CWP procurement process… Accordingly, I am of the view that the evaluation of the process, the selection and appointment of the CWP implementing agents was unlawful,” Judge Selemang Mokose ruled.

However, this does not mean that the Community Work Programme -- which is a lifeline for roughly 280 000 unemployed -- is in jeopardy. 

Seriti had asked the court to give Cogta three months to appoint new implementing agents. Instead, the court ruled that the “constitutionally invalid and unlawful” contracts will be allowed to continue until they naturally come to an end in March next year.

“The effort of re-issuing and processing a new [request for proposals] is a singularly expensive exercise which could take several months. Setting it aside could lead to disruption and prejudice to the beneficiaries,” Mokose noted.

Seriti did, however, walk away with something: The government will have to pay the costs of the application, including the costs of two counsel.

An expensive typo

Although the Community Work Programme participants earn little – just R780 a month – the contracts can be highly lucrative for the implementing agents.

In order to qualify as implementing agents, non-profits had to submit audited financials showing turnover of more than R5-million a year, as well as proof they had managed similar programmes in the past.

Yet documents disclosed as part of the two-year court battle raise serious questions about the procurement process and Cogta’s care of public funds.

Initially, 81 of the 89 bidders were disqualified for non-compliance, including Seriti, which has years of experience with the programme.

Four days later, however, the evaluation committee decided that aspects of the tender were vague and requested all disqualified bidders to submit their outstanding documentation.

An email was sent to 71 of the bidders, including Seriti. The email, however, was sent to the wrong email address which meant that Seriti never knew it had an opportunity to submit additional documentation.

“I am satisfied that had the applicant received the email inviting it to submit further documents, it would have provided the said documents and cured any deficiencies in its proposal,” Mokose ruled.

In addition to this, an independent assessment of the shortlisted bidders, conducted before contracts were awarded, identified serious problems.

 One bidder was described as “a small organisation which appeared to be struggling to stay afloat” with “evident capacity challenges”. Another bidder, the report noted, “did not have a functional governing body or board of trustees/directors to effect governance oversight to their operations”.

 

Despite this, both non-profits were awarded contracts to run the programme for three years. However, both were suspended 18 months into the contract.

Despite ample evidence that the procurement was tainted, Cogta continued to fight the case against Seriti. In court, counsel for the government argued that the usual procurement rules did not apply as the appointment of implementing agents “was not a procurement or tender process” but a transfer mechanism. 

But Mokose was having none of this, and reminded the government that, amongst other things, procurement legislation “serves as a guardian against a process that is skewed by corrupt influences”.

 *The amaBhungane Centre for Investigative Journalism, an independent non-profit, produced this story.


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