In ar­rears for R300m

CityPress - - News - SIPHO MA­SONDO­sondo@city­

Af­ter four years of ad­min­is­tra­tion by Na­tional Trea­sury, four com­pa­nies are su­ing the Lim­popo depart­ment of education for al­most R300 mil­lion over can­celled con­tracts. The com­pa­nies in­clude: In­dian ed­u­ca­tional soft­ware firm Sankhyaa Learn­ing, which is su­ing the depart­ment for R130 mil­lion;

Text­book sup­plier EduSo­lu­tions, which is su­ing for R121 mil­lion;

Con­struc­tion firm Aure­con Joint Ven­ture, which is su­ing for R41 mil­lion; and

An­other com­pany, a “pro­fes­sional ser­vice provider”, which has not been named in the depart­ment’s an­nual re­port and which has al­ready suc­cess­fully sued for R7 mil­lion.

All the law­suits were lodged in the North Gaut­eng High Court.

EduSo­lu­tions made head­lines around the coun­try when it failed to de­liver text­books to Lim­popo schools for the 2012 aca­demic year. Pro­vin­cial ad­min­is­tra­tor Monde Tom can­celled the con­tract with the com­pany in April that year and as a re­sult, most of the prov­ince’s learn­ers spent most of the year with­out text­books.

EduSo­lu­tions, Aure­con and Sankhyaa are three of a num­ber of com­pa­nies which had their con­tracts can­celled af­ter the ad­min­is­tra­tors moved into Lim­popo in De­cem­ber 2011.

Sankhyaa Learn­ing, an In­dian com­pany based in Chen­nai, had its con­tract can­celled in De­cem­ber 2013, two years af­ter the depart­ment was placed un­der ad­min­is­tra­tion.

Ac­cord­ing to court pa­pers, the depart­ment had con­tracted the com­pany to sup­ply schools with 3 000 lap­tops and 730 desk­top com­put­ers pre­loaded with HeyMath, a soft­ware pro­gram in­tended to make the teach­ing of maths easy and fun. HeyMath’s li­cence fees amounted to R27 mil­lion a year for the three-year pe­riod end­ing in 2014.

How­ever, in re­spond­ing pa­pers, the depart­ment says it can­celled the con­tract with Sankhyaa be­cause it “con­tra­vened the pub­lic fi­nance man­age­ment act” and be­cause the com­pany did not de­liver the 3 000 lap­tops it was sup­posed to.

The depart­ment also in­sists the soft­ware was not ac­ces­si­ble on­line and there­fore of no ben­e­fit to pupils.

Of­fi­cials al­ready paid the com­pany R10.2 mil­lion for the desk­top com­put­ers it sup­plied.

“The agreed 180 000 li­cences as per the agree­ment were to be ac­cessed on­line on the HeyMath web­site via the in­ter­net us­ing in­di­vid­ual user ac­counts,” the depart­ment says in court court is con­struc­tion firm Aure­con, which in 2013 was con­tracted to “of­fer pro­ject man­age­ment ser­vices for a num­ber of con­struc­tion projects”.

Aure­con dragged the depart­ment to ar­bi­tra­tion af­ter it re­fused to pay it about R26 mil­lion. The ar­bi­tra­tor ruled in favour of Aure­con, but the depart­ment did not pay up for more than a year, prompt­ing Aure­con to ap­proach the court ask­ing it to make the ar­bi­tra­tion rul­ing an or­der of court.

The court pa­pers re­veal that dur­ing the ar­bi­tra­tion process, it was dis­cov­ered the depart­ment had sent Aure­con a let­ter, say­ing the con­tract was “se­ri­ously flawed to the ex­tent that it should be re­viewed and set aside as an il­le­gal­ity”. How­ever, the pro­ject was not can­celled.

The pro­vin­cial depart­ment’s lat­est an­nual re­port says: “Judg­ment was given against the depart­ment on the amount of R41 mil­lion. As at the end of the fi­nan­cial year, the depart­ment had set­tled the cap­i­tal and le­gal costs as part of the award which amounted to R26 mil­lion, and is en­gag­ing with the ser­vice provider [Aure­con] on the re­main­ing amount for pos­si­ble set­tle­ment.”

An­other com­pany now su­ing the depart­ment is EduSo­lu­tions, the con­tro­ver­sial com­pany whose con­tract the depart­ment can­celled in April 2012. The firm is su­ing the depart­ment for just over R121 mil­lion.

The depart­ment of ba­sic education can­celled the com­pany’s ten­der af­ter re­ceiv­ing le­gal ad­vice that the con­tract was il­le­gal, and there­fore null and void.

EduSo­lu­tions re­ceived a con­tract worth over R300 mil­lion to buy, pack and dis­trib­ute text­books and other learn­ing ma­te­rial to all pub­lic schools in Lim­popo. In an on­go­ing coun­ter­suit, ba­sic education min­is­ter Angie Mot­shekga claimed for R88 mil­lion, al­leg­ing the com­pany had re­ceived R19 mil­lion in man­age­ment fees it did not de­serve.

EduSo­lu­tions, she also ar­gued, had un­fairly ben­e­fited to the tune of R68 mil­lion in dis­counts from book pub­lish­ers – money, she said, which should have gone to the depart­ment be­cause it had al­ready ne­go­ti­ated dis­counts from pub­lish­ers.

In court pa­pers, EduSo­lu­tions claims the R121 mil­lion is for “the loss of in­come, man­age­ment fees and dis­counts” which the com­pany ne­go­ti­ated with pub­lish­ers and sup­pli­ers of education ma­te­rial.

The pro­vin­cial depart­ment’s an­nual re­port also re­veals that other un­named pro­fes­sional ser­vice providers have suc­cess­fully sued it, in­clud­ing one un­named firm.

“The depart­ment has al­ready lost one of th­ese cases and paid R7 mil­lion as an award,” the an­nual re­port states.

The depart­ment of education in Lim­popo de­clined to com­ment, say­ing the cases were sub ju­dice.

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