During Andre de Ruyter’s tenure as Eskom CEO, the utility allegedly spent R500 million over three months to procure security services from Fidelity following a closed tender process.
These allegations have been made by The Association of Private Security Owners of South Africa (Tapsosa). They are demanding an inquiry into the tender processes followed by De Ruyter and Eskom.
Among their allegations is the claim that De Ruyter flouted normal tender processes to approve the deal under the guise of emergency services procurement.
Following emergency procurement processes, there was no requirement to have an open and competitive tender process. A single company, Fidelity, was allegedly hand-picked.
Thus, normal procurement processes, which are stipulated in the Public Finances Management Act (PFMA), were not followed by Eskom.
Tapsosa said it seeks transparency and clarity on what services were procured, the procurement process, and why this particular company was chosen.
To this end, the association wrote to De Ruyter when he was CEO at Eskom and the utility’s COO, Jan Oberholzer.
When it was met with silence, Tapsosa escalated its demand for transparency to the National Treasury.
Tapsosa met with the Treasury, who said Eskom did nothing wrong in using emergency procurement processes as the PFMA outlines cases in which normal procurement processes can be ignored.
The security association alleged that the emergency tender was initiated to follow up on De Ruyter’s intelligence report conducted by George Fivaz Forensic and Risk and funded by Business Leadership South Africa (BLSA).
Tapsosa said it would escalate its demands to the relevant Parliamentary oversight committees and the Electricity Minister, Kgosientsho Ramokgopa.
Eskom has said it is investigating the matter.
De Ruyter’s R50 million investigation under scrutiny
Andre de Ruyter’s private investigation conducted by George Fivaz Forensic and Risk has come under fire recently from the government and independent analysts.
The report “contained no facts” and was “effectively worthless”, according to reports by journalist Jacques Pauw.
The investigation also relied on evidence collected by a former Apartheid operative, Tony Oosthuizen.
According to Pauw, Oosthuizen holds racist views and boasted to him about committing murders during the Apartheid era.
The R50 million investigation, funded by BLSA, which contributed R18 million, used “rogue, half-baked intelligence dossiers” to form the basis of “wild and uncorroborated allegations”.
Political analyst Khaya Sithole called the botched investigation a reputational mess for BLSA, Andre de Ruyter and Eskom in an interview on 702 with Bruce Whitfield.
The means through which it was conducted was not justified by the ends as it produced evidence that was not admissible in court.
Despite the state not fulfilling its obligations to investigate corruption at Eskom, BLSA and De Ruyter were not justified in keeping the investigation hidden from the Eskom board.
De Ruyter, as Eskom CEO, and Busi Mavuso, BLSA’s CEO and an Eskom board member at the time, were obligated to notify the board of the investigation.
According to Sithole, funding such an investigation while being a board member was a significant conflict of interest for Mavuso.
Furthermore, the report would inevitably have ended up with the board and various oversight bodies – regardless of how the investigation was carried out.