'I warned them,' Denel's chief production planner tells state capture inquiry

30 October 2020 - 11:37
Denel Land Systems' former CEO allegedly aided and abetted the capture of the state-owned company by the Gupta family. File photo.
Denel Land Systems' former CEO allegedly aided and abetted the capture of the state-owned company by the Gupta family. File photo.
Image: REUTERS/Siphiwe Sibeko

The state capture inquiry is hearing testimony about the alleged irregular awarding of a steel component contract by Denel to a Gupta-linked company.

Chief production planner at Denel Land Systems (DLS), Hendrik Johannes Christoffel Van Den Heever, on Thursday detailed how he advised against using the company VR Laser for a Hoefyster contract after emerging controversies in the news.  

His responsibility in procurement was to judge competing companies on the technical component, namely functionality.  

Van Den Heever said he had worked at Denel for many years and moved through the ranks. From 2011 he worked on the Hoefyster contract as a system programme manager. Part of his responsibility was to rate bidding companies — in this case, LMT, VR Laser and DCD — regarding technical service strength.  

He said he initially scored in favour of VR Laser, the alleged Gupta-linked company.

“LMT came second in line by receiving an overall score of 64.7%, 0.76% less than VR Laser. However in relation to the price, LMT's offer was R165.6m, making it the cheapest. VR Laser's price was R262.4m, almost a R100m more than LMT,” read his affidavit.

He admitted to having made a recommendation in support of the company.

“We had different questions for the bidders to answer in the evaluation regarding functionality. They [VR Laser] answered satisfactorily,” Van den Heever testified.

His recollection of the gap in rating between LMT and VR was “quite a significant gap in favour of VR Laser”.  

The inquiry's chairperson, deputy chief justice Raymond Zondo, asked him whether the difference in years of experience between LMT [considered more experienced] and VR Laser counted for something.

Van Den Heever said he had a past experience of delays with LMT.

“There was no question or scoring attached to experience. Certain aspects of that was covered in the questionnaire. [The questionnaire] does not specifically cover experience but capability,” he said.

After his recommendation on the technical level in favour of VR Laser, media articles regarding alleged state capture surfaced, and his opinion was then not to use VR Laser anymore and instead opt for LMT.  

In his e-mail to his superiors, he said: “I have a fear that if we go with VR Laser, at the end we will be forced by Denel to change to LMT.  

“I get the feeling that we go with LMT to avoid fallout from Denel. We can spend the difference in price to get LMT up to standard with sufficient space facilities and resources to handle platform haul manufacturing.”

At the time, LMT did not have sufficient space for the magnitude of the contract as they had moved to a smaller facility, he said. This was a mere recommendation and not in his power to implement.  

During the week, the state capture inquiry has zoomed in on the allegations of institutional capture by the infamous Gupta family through their connection with former president Jacob Zuma.  

Former group supply chain management executive at Denel, Dennis Mlambo, on Wednesday told the inquiry how he was sidelined by top managers so tender processes could be flouted to favour a Gupta-linked company.

The testimony came after that of former contracts manager at DLS, Celia Malahlela, about three contracts the company had awarded to VR Laser, a company linked to the Guptas and Zuma’s son, Duduzane Zuma.

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