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Prisons graft: Here’s the proof, minister

ADRIAAN BASSON | JOHANNESBURG, SOUTH AFRICA - Jan 30 2009 05:00

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On Sunday the Department of Correctional Services placed expensive advertisements in three national newspapers, urging anyone with proof of impropriety in the awarding of prisons’ contracts to inform South Africa’s law enforcement agencies.

This week we present the proof.

Confidential documents and correspondence leaked to the Mail & Guardian suggest a highly improper relationship between the department and controversial facilities management group Bosasa.

We can reveal that Bosasa, which has received nearly R3-billion in contracts from Correctional Services Minister Ngconde Balfour’s department:

Had confidential documents leaked to it by the department’s former chief financial officer and Balfour confidant Patrick Gillingham;
Had access to tender documents for major prison projects before they were advertised; and
Spied on senior correctional services officials during a 2006 workshop.

Bosasa is headed by Eastern Cape businessman Gavin Watson, whose family had close ties with the Eastern Cape ANC during the struggle years, when the Watson brothers became famous for refusing to play rugby for a whites-only Springbok team.

The group also runs the controversial Lindela repatriation camp for the Department of Home Affairs and has large contracts with the South African Post Office, Airports Company of South Africa and the departments of justice and transport.

The Special Investigating Unit (SIU) has been probing Bosasa since 2006 and raided its offices in December. Three weeks after the raid the
company was re-awarded the massive prisons catering contract it landed in 2004.

The department’s advertisements on Sunday were a reaction to the M&G’s report last week of alleged irregularities in the awarding of the latest catering tender.

Former prisons commissioner Vernie Petersen suspended Gillingham in September after receiving a preliminary SIU report. Petersen was later transferred to the sports department in what was widely seen as a reprisal for his opposition to Balfour’s attempts to extend the 2004 contract.

Balfour also wanted Gillingham to head the tender committee awarding the new contract, while Petersen insisted that Gillingham not be involved.

CONTINUES BELOW

2004: A new romance
In 2004 the contract for running prison kitchens was outsourced for the first time. The tender was officially advertised on May 21 in the government’s tender bulletin.

But documents show that on May 1 Bosasa employee and co-founder Danny Mansell sent Bosasa’s operations coordinator, Angelo Agrizzi, papers containing more than 90% of the bid conditions and specifications.

Three weeks later the Department of Correctional Services made available the same document, with the same spelling errors, to the rest of the catering sector.

On August 6 Bosasa was awarded the entire contract, worth R239-million a year, for three years.

The department extended Bosasa’s contract for another year and expanded it to include more prisons, adding R82-million to the bill. It was the further extension that led to Petersen’s clash with Balfour.

In July 2004 the department also gave Bosasa a R1-million tender for nutritional training for prisons’ kitchen staff. Again Mansell sent Agrizzi large parts of the tender document, including bid conditions and specifications, on May 12. The tender was advertised on June 4.

2005: You’ve got mail
The inclusion of CCTV cameras in the catering tender meant that by 2005 Bosasa had a national control centre to monitor the kitchens.

This linked perfectly with its next contract -- a R237-million tender for access control and CCTV in 66 prisons. It went to a newly registered company, Sondolo IT, which Beeld revealed in 2006 was 40% owned by Bosasa Operations.

Other shareholders included former president Thabo Mbeki’s political adviser Titus Mafolo and former Strategic Fuel Fund chairperson Seth Phalatse.

On December 17 2004 Bosasa’s IT coordinator, Johan Helmand, emailed Agrizzi certain tender specifications that were to appear in the official bid document published on February 4 2005.

On April 29 Sondolo IT was awarded the contract. In 2005 Agrizzi and Gillingham started emailing each other prison research reports and newspaper clippings. On August 29 Gillingham sent Agrizzi a copy of questions from City Press, put to the department about the Bosasa contracts, the leaked documents show.

On December 9 2005 Bosasa landed a R487-million prisons’ contract for security fencing through a small Cape Town firm, Phezulu Fencing, it had purchased.

There is double proof that the company had privileged information long before the tender was advertised. Three months earlier, on September 25, Agrizzi emailed Mansell a voluminous document containing bid specifications. “Please verify and check, we can sit tomorrow am,” Agrizzi wrote.

On October 3 Agrizzi sent a longer version, headed “Fence Doc Final”, to the chief executives of Bekaert Bastion and SA Fence & Gate, Michael Rodenburg and Geoff Greyling respectively, under the subject line: “Fence Doc Final ... Very Confidential ...”.

This contained the full bid conditions and specifications published by the department on October 14. Bekaert Bastion supplied cladding material and SA Fence & Gate was contracted to do part of the installation.

This week Greyling “categorically” denied seeing a copy of the bid document before it was published. He said: “It should be recorded that the tender was based on the standard public works/correctional services specification with which we are well acquainted from previous bids. The prior possession of the tender document by anyone would therefore be of no specific advantage to such person.”

Colette Stofberg of Bekaert Bastion (now called Betafence) replied that “years before this contract” Betafence provided technical specifications to the department of public works that were used in this tender.

According to an industry insider the big advantage lies in knowing the quantities required for the tender weeks before your competitors.

On October 10 2005 Agrizzi sent Gillingham a six-page document titled “Equipment Specifications & Guidelines”. The same section featured in a tender for a comprehensive tele-vision system, comprising 6 000 TVs for communal cells, published four days later.

On November 28 Agrizzi emailed Mansell the confidential evaluation sheet the department used to adjudicate the TV tender, which Sondolo IT won on March 17 2006.

2006: spies in the house
On February 9 Agrizzi sent Gillingham a document, headed “Tender Evaluation Criteria New Waterval”, containing comments on bid specifications for a contract for catering services at seven prisons in the Waterval management area, KwaZulu-Natal.

The tender was officially advertised on May 19. Seven days earlier Gillingham sent Agrizzi the confidential evaluation sheet for the Waterval tender with a message: “Hi, Attached please find the reworked evaluation sheet for your comments. You will notice the evaluation sheet for site visits cannot be published and will not form part of this document. Regards, Patrick.”

On September 15 Bosasa Operations was awarded the Waterval catering tender, worth R123-million over five years. On April 24 2006 Agrizzi sent Gillingham a letter in which an anonymous writer asks the chairperson of Parliament’s correctional services, Dennis Bloem, to “sort out” the attack on the department by “international capitalists” and “activist Afrikaner companies”. This week Bloem confirmed receiving such a letter.

On June 21 Agrizzi sent Gillingham a surveillance report of a prisons department security workshop at a Drakensberg hotel in June 2006. The 25-page report makes it clear that the agent was asked to spy on the department’s chief deputy commissioner of security, Willem Damons, and his subordinate, Tonie Venter. The report also contains pictures of people and cars at the hotel, as well as the inside of the conference room.

In his message to Gillingham Agrizzi wrote: “I didn’t see the reason/need to email you the rest; nothing actually happened.” Gillingham replied the next day: “Hi, Thanks for the report and it seems as if they behaved well during their session. Regards.”

Bosasa’s lawyer, Brian Biebuyck, advised his client not to answer the M&G’s questions. He warned the M&G to publish “at your peril” and said Bosasa would pursue charges of criminal defamation if defamatory material was printed.

The department’s Manelisi Wolela responded that the M&G’s questions “are part of a broader brief given to the SIU” and urged the newspaper to provide the unit with proof of impropriety. Gillingham did not respond to the M&G’s queries.

Pictures from a confidential surveillance report of a senior Department of Correctional Services meeting in the Drakensberg in June 2006.

Related Documents
Annexure A: Email from Patrick Gillingham to Angelo Agrizzi in which he comments on a report by chief deputy commissioner Willem Damons about a tender for x-ray scanners

Annexure B: Email from Agrizzi to Gillingham with price specifications for TV systems tender published a week later

Annexure C: Email from Agrizzi to Gillingham with suggestions about promoting Bosasa

Annexure D: Anonymous letter to Dennis Bloem emailed by Agrizzi to Gillingham

Annexure E: Email from Agrizzi to Gillingham with evaluation sheet for Waterval catering tender

Annexure F: Email from Mansell to Agrizzi with tender specifications for 2004 catering contract

Annexure G: Email from Mansell to Agrizzi with tender specifications for nutrition training contract

Annexure H: Email from Helmand to Agrizzi with tender specifications for access control contract

Annexure I: Email from Agrizzi to Mansell with tender specification for security fencing contract

Annexure J: Email from Agrizzi to Rodenburg and Greyling with tender specifications for security fencing contract

Annexure K: Email from Agrizzi to Gillingham with tender specifications for TV system contract

Annexure L: Email from Agrizzi to Mansell with confidential evaluation sheets for adjudication of TV system contract

Annexure M: Email from Agrizzi to Gillingham with comments on KwaZulu-Natal catering tender’s request for approval

Annexure N: Email from Gillingham to Agrizzi with evaluation methodology and evaluation criteria sheets for KZN catering tender

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Comments

WoW!! and WoW! again. So the Watson saga continues. It looks like they will be awarded the catering position from within the prison services very soon, instead of from external. It will be interesting what this cheecky Watson have to say for himself now. But the question is, what will that bloated Minister do now? Wash his hands again, the same way as with the other times? It is abundantly clear that the ANC have done well on one of its election promisses, and that is to look after those who looked after them, but the public feels that the payback time is finish now. Thats why Cope will lead us into a new dispensation where true accountability is one of the pillars of their manifesto and core beliefs. Mr. Nkondo, you are also past your shelf-life sir, time to take your millions and go on pension.

Hein Huyser on January 30, 2009, 5:54 am

tell us something we dont know

brigitta stone on January 30, 2009, 8:52 am

Graft, graft, graft, graft.

The ANC has to be punished at the polls. Adequate support for COPE will allow even more graft to be uncovered by a COPE led administration.

The future of our country is in the hands of the people of our country.

Mahomed Farouk Cassim on January 30, 2009, 11:31 am

And this is the goverment that you want ruling the country for the next four years? Did'nt Jacob Zuma say something about weeding out corruption recently? It would be interesting to see the ANC's response to this

Chris Nell on January 30, 2009, 11:51 am

I've written many comments referring to the gravy-trainers with their greedy snouts in the ANC feeding trough. It really hurts as a diligent tax payer to see yet again examples of how our tax contributions are wasted and used to reward ANC favours.

I cannot see why the desperately poor voting majority of our voters continue to vote in a government that is completely arrogant the way it throws around our hard earned tax money. Those same voters voted for Mugabe in Zim for many years believing he was their liberator and look how they were rewarded.

The ANC poses as a government of liberation. So far all it has liberated are our hard earned taxes to reward those who have greased their palms.

Anthony Krijger on January 30, 2009, 1:57 pm

Disgusting but expected!

Ahed Johb on January 30, 2009, 2:26 pm

Excellent piece of journalism. I'll go out and buy a hardcopy of the M&G just to pay this guy's salary.

Charles van der Wath on January 30, 2009, 3:43 pm

The ANC has to show that indeed it does not reward graft by protecting Balfour and all the people involved. I however think that as South Africans need to make a clean break with the ANC and it's very deep rooted culture of contracts for pals. For as long as this culture goes, ordinary people are denied the essentials that a government should provide, as the money is misplaced due to corruption and incompetence. Congress Of The People gets my vote. It's an opportunity to start on a better footing.

Goitse Mabiletsa on January 30, 2009, 6:40 pm

This is nearly as bad as the arms scandal. It beggars belief that one company (and its surrogates) could corner the market on prison services without the direct collusion of the Minister and his cronies. Hmmm... what will their defence will be? "There were no irregularities; the tender information was common knowledge"? Or maybe, "Normal business practises were followed in all cases"? By minimising the significance of collusion, corruption, and fraud, they will hope to make it seem no more than a minor breach of ethics, IF they admit any wrongdoing at all.

ANC...All Natural-born Criminals?

on January 31, 2009, 9:08 am

Did anyone really expect anything else?
This is only one government establishment, if the rest are investigated the picture will probably be much the same.

Joe Irwin on January 31, 2009, 9:58 am

Even if one is to live with and accept the fact that corruption may or may not have happenned,what pains me is the fact that all these tenders were won by one company,how can they be the only ones capable of delivering accordingly,also what is the attitude of government when it comes empowering on a broad scale.Who will be interested to go one on one with Bosasa in future when when tendering when we all know that they will be the only winners.This is very bad for anyone else considering that they have recently been given a new contract,also goes to show that human beings are fallible which is why we need SCORPIONS more than ever.

dinki guma on February 1, 2009, 1:36 pm

You're kidding yourself if you think that there are tenders that go out that aren't worked towards a particular company.

The harness tender for Gajima AST... they just happen to be awarded a R2bn contract a couple days after anouncing that they're going to be the major sponsor for the GovTech conference? Come on. (and the service delivery here is tragic)

Group 5 and the private prisons... any takers here?

ARV's and Aspen, let's not even pretend that the other companies that were awarded percentages (come on, 6.9% for GSK doesn't even come close to the whopping 2bn that Aspen got) Doesn't hurt that there's been plenty of alleged coddling between aspen and the department doesn't it?

Like it or not, this is the way the government does business. And it makes sense when you consider that the government uses consultants to structure tender requirements. The consultants are necessary, the government just doesn't have the internal capacity to structure the tenders without these consultants and the consultants wont stop consulting to work for the government because they'll never get the same money. The problem with the consultants making the tenders is that they often do it with a particular friendly company in mind...

Thabiso Ngokisa on February 4, 2009, 2:54 pm

AWARD-WINNING JOURNALISM!

This is how the government works, tenders are for friends. Corruption is deep-rooted within the ANC, im interested to hear what Balfour will say, I will collapse with shame if he says he didnt know! How is it possible that only one company can be awarded tenders when there's over a dozen companies in S.A

The saga continues...........

mpumi mpumi on February 6, 2009, 8:37 am

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