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Court declares R2.5 billion eNaTIS contract invalid

24 June 2015 - 12:15 By Ernest Mabuza

The high court in Pretoria has declared that the extension of the eNaTIS system contract from 2010 to 2015 by former transport department director-general George Mahlalela was invalid from the date of extension. Tasima was awarded the tender to operate‚ manage and maintain the country’s vehicle registration system since 2002.From 2007‚ Tasima provided the service on a month-to-month basis because the department wanted to offer the service in-house‚ but Mahlalela in 2010 extended the agreement for another five years.There had been a dispute about the extension of the contract by Mahlalela‚ but it had not been resolved when the contract expired on April 30.Tasima approached the court this year in an effort to persuade the department to allow for a five-year phased transfer and handover of the eNaTIS system to the department.However‚ the department wanted an immediate hand over and launched a counter-application to declare the contract Mahlalela signed in 2010 extending the contract invalid from the beginning.In her judgment‚ Judge Wendy Hughes said there had been a material dispute since 2012 as to whether the agreement was amended and extended to April 30 2015.Hughes said: “From the outset it is clear to me that Mahlalela did not adhere to section 217 (1) of the Constitution in that the extension agreement was not done in a fair‚ transparent‚ equitable and competitive and cost-effective manner.“With regards to the cost-effective aspect‚ it is illustrated by (the transport department) that in the Mahlalela extension period‚ (Tasima) gained R2.5 billion whilst the initial contract was for R355 million inclusive of VAT.”Another contract extension that Mahlalela signed‚ for the provision of driver licence cards with Prodiba‚ was declared invalid from the outset by the Supreme Court of Appeal in March this year.Mahlalela signed the contract extension in February 2013 for a five year period beginning from March 2014.Hughes said the transfer of the system from Tasima to the department could not be a lengthy process as the department had the benefit of running the eNaTIS system on a month-to-month basis from 2007 to 2010 and a further five years thereafter.She ordered that the department request the transfer within five days of the date of the order‚ and that it be completed within 30 days of the request.Transport Minister Dipuo Peters welcomed the court ruling and hailed it as victory for taxpayers. The department would not immediately say if it would claim the money back.“The end of this tedious journey leaves us with several lessons with regard to prudent utilization of public funds. It also forces us to reflect on contract management‚ especially when it concerns contracts of this magnitude‚” Peters said.Efforts to contact Tasima were unsuccessful...

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