President orders probe into SAP contract
• Water department the target as Ramaphosa extends crackdown
President Cyril Ramaphosa has authorised a new investigation into a water ministry contract with German software company SAP on Thursday, citing allegations that public money was spent unlawfully. The investigation by the Special Investigating Unit comes after the country’s anticorruption agency said in March it was conducting its own probe into a R671m water ministry deal with SAP.
President Cyril Ramaphosa authorised a new investigation into a water ministry contract with German software company SAP on Thursday, citing allegations that public money was spent unlawfully.
The investigation by the Special Investigating Unit (SIU) comes after the anticorruption agency said in March it was probing a R671m water ministry deal with SAP.
SAP is one of several foreign companies to suffer reputational damage in SA after becoming entangled in corruption scandals under Ramaphosa’s predecessor, Jacob Zuma.
Ramaphosa has launched a graft crackdown since replacing Zuma in February, and several probes into government and private companies have started.
SAP said on Thursday it is aware of the contract to be investigated by the SIU and it is reviewing all its public sector work in SA dating back to 2010. “If we identify any matters of concern, we will address and manage them vigorously and comprehensively. SAP continues to co-operate with US and South African authorities in their ongoing investigations,” it said.
BROKEN LAWS
SAP said in October 2017 that the US department of justice and the US Securities and Exchange Commission had opened an investigation related to SA into the company under the US Foreign Corrupt Practices Act.
The SIU, which reports directly to Ramaphosa, will seek to establish whether water department officials or SAP employees had broken any laws and will focus on the period from January 2015 to 2018.
SAP admitted in March to paying more than $9m to intermediary companies controlled by the Guptas, relating to deals with Eskom and Transnet.
The presidency confirmed on Thursday that the SIU would also probe contracts involving the Ekurhuleni and eThekwini metropolitan municipalities.
GRANT FUNDING
It said the Media‚ Information and Communication Technologies Sector Education and Training Authority would also be investigated for “alleged maladministration in relation to the allocation of discretionary grant funding to a number of companies‚ which will themselves also be probed”.
In the case of the Ekurhuleni metropolitan municipality‚ the SIU investigation relates to alleged serious maladministration and improper or unlawful conduct by employees‚ officials‚ agents or contractors of the municipality‚ arising from the procurement of goods and services for the construction of the Vosloorus Hospital public transport facility and the Bluegum View public transport facility.
The SIU will probe claims that procurement for these projects during a period around February 2014 had been unauthorised‚ irregular or fruitless and wasteful and that procurement had not been fair‚ competitive‚ equitable or cost-effective.
Regarding the eThekwini metropolitan municipality‚ the SIU has been authorised to investigate the “allegedly irregular award of a tender” in about January 2014‚ for the supply to the municipality of waste recycling bags‚ the presidency said.
SAP declined to comment on the allegations when contacted by Reuters in March.
SAP shares were little changed after the SIU investigation was announced, trading up 0.7% at €99.96 at midday.
IF WE IDENTIFY ANY MATTERS OF CONCERN, WE WILL ADDRESS AND MANAGE THEM VIGOROUSLY AND COMPREHENSIVELY