PRASA's "systemic failure" on supply chain policy

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ThuliMadonsela.jpgAn investigation into alleged tender irregularities and other mismanagement at the Passenger Rail Agency of South Africa (PRASA) has found a “systemic failure” to comply with supply chain management (SCM) policy.


In a report entitled ‘Derailed’, public protector Thuli Madonsela outlined findings from the investigation of 37 complaints initially lodged by the South African Transport and Allied Workers Union (SATAWU) in 2012, and later pursued by the National Transport Movement (NTM). They alleged maladministration and improper conduct involving procurement irregularities, conflict of interest, nepotism and human resources mismanagement, including victimisation of whistle-blowers, by functionaries at PRASA.


Various allegations, though not all, were substantiated, according to the report, including allegations of improper awards, extensions and terminations of contracts, personnel appointments and suspensions, failing to take disciplinary actions, as well as incurring improper expenses and wasteful expenditure.


The report said that “the transactions investigated and related findings reveal a culture of systemic failure to comply with the SCM policy, particularly involving failure to plan for bulk procurement, test the market appropriately for competitive pricing and to manage contracts, a culture which may have cost PRASA millions in avoidable expenditure and preventable disruption of services.”


The report also noted that there seemed to be “a culture of either poor information management or hiding of information that could provide evidence of maladministration and other forms of improper conduct”.


Madonsela made various requests for remedial action including that the transport minister and PRASA chairman take disciplinary action against responsible officials, and that the acting group chief executive review its policy on managing conflicts of interests, as well as making sure contracts were vetted by lawyers.


This article was first published on SupplyManagement

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