Former Passenger Rail Agency of South Africa chair Popo Molefe made his third appearance at the Zondo commission of inquiry into State Capture on Friday, testifying about contracts worth billions that were awarded to contractors without the relevant skills or experience.
Judge Raymond Zondo, presiding over proceedings, heard that former CEO Lucky Montana was awarded lucrative locomotive procurement contracts to companies without the requisite qualifications in processes that were “fraudulent” and “corrupt”, according to Molefe.
One contract worth R3.5 billion was awarded to Swifambo Rail Leasing, while another company, Siyaya Consulting Engineers, received some R900 million from Prasa between 2010 and 2011.also previously reported that less than a week after Prasa made its first payment of nearly R500 million to Swifambo, the latter’s managing director paid R14.3 million into the account of a lawyer who had introduced himself as an ANC fundraiser. The total would come to nearly R80 million.
According to Molefe, Swifambo was initially meant to carry out the leasing of locomotives to be used for passenger services and for routes in various metro areas. The board later found that the company did not meet Prasa’s requirements and that its procurement was questionable.
“The investigation that we conducted demonstrated conclusively that that procurement process was fraudulent, corrupted, and that Swifambo itself, notwithstanding the fact that it did not meet the requirements set out in the RFP – they needed to demonstrate that they had skills necessary to carry out a program of the size and prominence that it was.
“Suddenly, Swifambo was allowed to offer a proposal on the manufacturing of locomotives, which was not part of the RFP right at the beginning. There were specifications around what would be needed by Prasa… what was to be leased or procured. [They] needed to comply with the rail safety regulators but they also needed to comply with the rail network of Transnet,” said Molefe.
‘In all matters, they did not qualify’
Molefe told the commission that the company also needed to have qualified people to carry out the job, but this was not the case with the Swifambo contract.
“They needed to have sufficient qualified people to carry out the programme. It was a requirement that a bond deposit of 10% the value of the contract be paid up front. They needed to demonstrate that they would be able to implement the local content required… in respect of all of these matters, Sifwambo did not qualify,” said the former chairperson.
In addition to finding that Swifambo was not qualified to carry out the project, the board also discovered that the contract was concluded and signed without disclosing the subcontractor.
According to Molefe, when Swifambo revealed its subcontractor, “the evidence that emerged shows that in fact the company that became the subcontractor of Swifambo… had nothing in its capacity to provide locomotives,” said Molefe.
Going to the top illegally
Molefe also told the commission that certain key employees received top positions without being qualified – some claiming they had qualifications that did not exist. Molefe made particular reference to former executive Daniel Mthimkhulu