Western Cape Government's communications tender - the facts

Firstly, there is absolutely no truth in the suggestion that there was anything improper or unprocedural in awarding this tender (see Sunday Times report).

The Sunday Times reported that the tender was not advertised.  Not only did we confirm to the journalist that the tender was advertised in Die Burger and the Cape Argus, we sent the journalist a scan of the actual advert that appeared in print. 

It was made clear to the journalist that the bid was not for the Premier's office. It was advertised by the Department of the Premier on behalf of the entire Provincial Government. 

The R1bn price tag is an absolute fabrication. It was made clear to the journalist that the estimated total communications spend of the Provincial Government is between R50m and R70m per year.

Using the average extraction rate of 18%, this means that the agency could earn between R9m and R12m per year for their professional services. This cost would most certainly be reduced as a single agency will allow the Provincial Government to leverage economies of scale and bulk discounts from the industry.

Questions must be asked why the Sunday Times chose deliberately not to present the facts as presented to them. We will be laying a formal complaint with the Press Ombudsman.

Secondly, the article cherry picks from an assessment document compiled by the Provincial Treasury and makes no reference to the formal Treasury Circular (no 25/2011) that states categorically:

It must be noted that the Provincial Treasury assessed the procurement process followed by the Department of the Premier and found certain discrepancies, but these are not regarded as critical.

There was absolutely no extension of mandate as alleged in the story. The Journalist was told that the scope of the bid specifically included a one-off fee for the development of a brand strategy, corporate identity manual and the communications strategy for the Provincial Government as well as for the ongoing communications services for every Department.

Treasury Regulations permit departments to participate in a contract arranged by another department. Accordingly, and on the advice of Provincial Treasury, this was the process that was followed by all departments. This information was provided to the journalist and also ignored.

In addition, the bid process:

• was assisted by Yardstick, the industry experts whose services were procured on the recommendation of the Association for Communication and Advertising;
• was assessed by an independent and separate Bid Adjudication Committee consisting of officials from various units including Legal Services, who found it in order;
• received no disputes from participating bidders; and
• was assessed by Legal Services who found no irregularities.

It is important to understand that nobody involved in either the Bid Specification or Bid Evaluation Committees were members of the Bid Adjudication Committee that made the final decision to award the contract.

I am confident that the bidding process was transparent, fair, equitable, competitive and cost effective. This notwithstanding, I have asked the Director-General to request that the Auditor-General conduct a tender process audit. 

The Western Cape Government has nothing to hide and will give the Auditor-General full access to any documentation or officials required for his investigation.

Statement issued by Western Cape Premier, Helen Zille, August 14 2011

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