DA calls on Hawks to investigate former SASSA CEO for R1 billion in irregular expenditure

23 November 2016

The DA will today request that three controversial contracts authorised by former SASSA Chief Executive Officer (CEO), Virginia Petersen, be thoroughly investigated by the Hawks.

This follows a SCOPA hearing today where the DA posed numerous questions to SASSA’s current CEO, Thokozani Magwaza and Mr Tsakeriwa Chauke, the Chief Financial Officer (CFO), relating to R1.1 billion in irregular expenditure.

Front and centre of this was the payment of R316 million to CPS for an invoice that should never have been generated in the first place. The CEO held fast, defending the CPS line, but there is no doubt that former CEO Petersen completely ignored basic definitions in the Supply Chain Management (SCM) Policy and in the contract between SASSA and CPS.

CPS successfully “double invoiced” SASSA for work it had already committed to in terms of these agreements.

Both the Auditor General and Treasury declared this payment irregular, with Treasury bordering on declaring the payment as fruitless and wasteful expenditure.

Added to this was the issue of security contracts to the value of R414 million that were allowed to muddle along for four years while SCM processes were fudged and obfuscated. Once again, CEO Petersen presided over this mess that ensured that seven contractors successfully kept rolling-over 6 month contracts for four years until her departure in May 2016.

Finally, CEO Petersen backed a bid by SAB & T for a R74 million contract despite a Bid Adjudication Committee recommendation that the competing bidder that scored the highest points be awarded the contract. Indeed, this matter was challenged in court and was found to be irregular.

Former CEO Petersen actively supported controversial and irregular contracts over the past four years to the value of R804 million.

The DA believes that there is clear evidence of criminality in all these procurement processes, and will be urging SCOPA to officially initiate an investigation into the actions of CEO Petersen.

Issued by Tim Brauteseth, DA Representative in the Standing Committee on Public Accounts, 23 November 2016