Transport department let out of driving licence card contract

The Department of Transport has won release from a contract its former director-general, George Mahlalela, signed in 2013 without the approval of the transport minister and which would have cost the department and the country just over R1-billion.

The Supreme Court of Appeal (SCA) on Wednesday dismissed as “invalid from the outset” a 2013 agreement between the department and Prodiba under which Prodiba would have supplied new technology driving licence cards.

In 1997, Prodiba was awarded a tender to supply the driving licence cards for a period of five years. The contract had been extended from time to time - by provisions which the SCA said appeared suspect - until February last year.

Before the last extension, the department decided to change from the initial card system to a microchip-based smart card driving licence system to be managed in-house.

However, on February 1 2013, Mahlalela signed a five-year contract with Prodiba, beginning in March last year, for the migration to the new system at a cost to the department of R1,097-billion.

Mahlalela’s contract expired on February 28,2013 and was not renewed.

Mahlalela signed the contract without the approval of the minister at the time, Ben Martins.

When the minister refused to acknowledge the contract, Prodiba approached the court and in 2013, the High Court in Pretoria ordered the minister to comply with the contract. The court rejected the minister’s submission that Mahlalela did not have the authority to enter into an agreement on behalf of the department.

On Wednesday, the appeal court said the high court failed to consider that the department contemplated a new technological framework for driving licences with major cost implications.

“Policy decisions such as those to migrate to a new style drivers’ licence system which impact meaningfully and, in this case nationally, on the population and which have significant fiscal implications, fall rightly within the province of the Legislature or the Executive,” Acting Deputy President of the SCA Mahomed Navsa said.

Navsa also said if the contract with Prodiba were to stand, it would mean that upon a single tender process during 1995 to 1997, a single contractor would have had an uncontested monopoly in the production of driving licences for a period of more than 20 years.

“Do our constitutional norms and values countenance such a situation? The short answer is no,” Navsa said.

Prodiba director Johan Vorster said the company was still in discussions with its legal team to consider its options.

“We are also in discussions with the department of transport to find an amicable solution,” Vorster said.

Prodiba has meanwhile continued to supply the current style driving licence cards on a month-to-month basis.

The department of transport did not respond to a request for comment.