More than half of government’s Covid contracts under investigation were irregular: SIU

A new report published by the Special Investigating Unit (SIU) shows that a significant number of Covid-19 procurement contracts entered into by the government were irregular – pointing to widespread misappropriation and graft.

President Cyril Ramaphosa authorised the release of the final SIU report on Tuesday (25 January), with the report focusing on procurement by all spheres of the government of goods, works and services associated with the Covid-19 pandemic.

Ramaphosa authorised the SIU to probe any allegations relating to the misuse of Covid-19 funds across all spheres of government. He has also stated that if the SIU found evidence that a criminal offence had been committed, it was obliged to refer such evidence to the National Prosecuting Authority.

As part of its work, the SIU investigated 5,467 contracts awarded to 3,066 service providers with a total value of R14.3 billion. Investigations have been finalised with respect to 4,549 contracts, of which 2,803 contracts were found to be irregular. This amounts to 62% of the finalised investigations.

“The submission of the final report is an important step in our fight against corruption in the public and private sectors, and against maladministration,” Ramaphosa said. This investigation targeted individuals and institutions who believed they could exploit a moment of national vulnerability to enrich themselves and those with whom they colluded to abuse public resources.”

“It is unacceptable that so many contracts associated with saving lives and protecting livelihoods were irregular, unlawful or fraudulent. This investigation demonstrates our determination to root out corruption and to deal with perpetrators.”

Ramaphosa said these cases have been referred to the National Prosecuting Authority, departments and entities in the public sector and other parties, who will finalise the process of bringing wrongdoers to book and addressing weaknesses identified by the SIU investigation.

• 45 matters – constituting a combined value of R2.1 billion – have been enrolled with the Special Tribunal on Corruption, Fraud and Illicit Money Flows. The Special Tribunal has a statutory mandate to recover public funds syphoned from the fiscus through corruption, fraud and illicit money flows, and engages in civil action that is more flexible and less time-consuming than adversarial.

• The SIU has made 224 referrals for disciplinary action against officials in government departments or entities.

• The SIU has made 386 referrals to the National Prosecuting Authority, as well as three referrals for Executive Action.

• The SIU has made 330 referrals for Administrative Action, which includes blacklisting.

• The rand value of actual cash and assets to be recovered on the basis of the investigation is R551.5 million, while cash and assets recovered to date total R34.2 million.

• The value of potential loss prevented by the investigation is R114.2 million, while contracts set aside amount to R170.4 million.

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