Cipro corruption allegations and dubious tenders: minister must explain
The situation at Cipro (Companies and Intellectual Property Registration Office) is out of control - dubious tenders, corruption allegations and dismal internal security are cause for great concern over the office's ability to meet its mandate. Urgent action is needed to clarify the situation.
Serious questions are mounting regarding the allocation of a tender to IT service provider ValorIT to administer Cipro's database for R152.7 million - while the company's biggest reported turnover has been less than R2.2 million. Worse still, there is proof that ValorIT had access to Cipro's business plan - which is confidential - and therefore constitutes tender rigging.
Millions of rands have already been pilfered from businesses because of faults in Cipro's information systems provided by ValorIT. The serious flaws in the system allow criminals to commit tax fraud by posing as businesses entitled to tax refunds - something that could have been avoided if the system was on standard.
If Cipro cannot be trusted to administer the affairs of business registration, then it places the entire economy at risk - small to medium size businesses are the engine room of job creation.
The Minister of Trade and Industry, Rob Davis, must explain how such a small business as ValorIT could've been judged as having "a track record to deliver on a contract of this magnitude" - and why Cipro deemed it fit to award such a big state tender to a business whose books have never been properly audited.
There is quite a difference between having a turnover of just over R2 million per year and the responsibility for a single contract worth R153 million. The Supply Chain Management Framework clearly stipulates that a prospective bidder must be able to prove that it can sustain a contract of such high monetary value.
Parliamentary questions also revealed that both the minister and the director-general of Trade and Industry have requested an audit regarding this tender - but it remains to be made public. The DA will be asking further questions on this matter.
Statement issued by Andricus van der Westhuizen, MP, Democratic Alliance deputy shadow minister of trade and industry, October 29 2009
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