The board of the South African National Roads Agency Limited (Sanral) has cancelled tenders to the value of R17.47-billion, citing “material irregularities”.
The tenders which the Sanral board did not approve are the Mtentu Bridge Wild Coast project, on the N2, valued at R3.4-billion; the rehabilitation of the R56 Matatiele, in the Eastern Cape, at R1-billion; the N3 Ashburton interchange, in KwaZulu-Natal, at R1.8-billion; and improvements to the EB Cloete interchange (N2 and N3 connection point in KwaZulu-Natal), at R4.3-billion.
The Open Road Tolling tender in Gauteng, valued at R6.88-billion, lapsed and was not renewed.
Sanral says the tenders were cancelled owing to “a material irregularity in the tender process” where a resolution made by its board in January 2020 was not implemented in the evaluation of the affected tenders.
The agency does not explain what this resolution entailed.
“It is common knowledge that for a proper governance environment to exist, board decisions must be implemented by management – unless, of course, the argument is about the legality of the board decision in question,” notes Sanral.
“Any alternative to that will result in the breakdown of governance and indeed in chaos, something which Sanral has hitherto avoided.”
Sanral says the board’s decision was informed by the conclusion of a “proactive assurance” conducted by its internal audit and legal teams, both of which “were bolstered by an external legal opinion”.
The agency says no prudent board would have allowed the awarding of the tenders to go ahead in the face of such opinion.
“It is also worth mentioning that there is no basis for any speculation about lack of communication between the board and management. Management was fully aware of the board’s decision.”
Sanral says it is unfortunate that the tender cancellations will lead to a delay in the implementation of what it calls “critical infrastructure projects”.
“However, it cannot be said that governance procedures must be thrown out of the window because we are all now rushing implementation.”