Tender fraud may top R25bn

Cape Town - The National Treasury is investigating tender fraud to the value of R25bn and is considering imposing penalties equivalent to double the value of those found guilty of defrauding government's tender processes, Minister of Finance Pravin Gordhan said on Wednesday.

Delivering his medium-term budget policy statement in parliament, Gordhan said that clean administration plays a central role in the overall bid to fast-track South Africa's economic growth and cut unemployment by 15% in a decade.

The bid to eliminate corruption from government's supply chain management comprises five initiatives and regulatory reforms. These include:

      •  Increasing the state's ability to detect fraud early;
      •  Increasing public disclosure at all stages of the supply process in all spheres of government;
      • Stiff penalties for those found guilty of manipulating tenders, officials included; and
      • Enhanced tax compliance measures.

"Members of the House will be pleased to note that government has awarded preservation orders worth about R200m which include a Lear jet, a golf course, a holiday home, and a hotel.

"This is the result of cooperation and coordination of efforts between several investigative agencies," said Gordhan. He added that, as a result of these efforts, the taxman was beginning to see a change of heart among government's service providers.

"In a recent case, a firm which was paid R10m by a department for work that had not been done voluntarily returned the money to the fiscus.

"We will turn the tide on corruption and fraud. We will ensure that tax funds and government monies are spent wisely and managed with integrity," Gordhan told MPs, saying that government owed it to honest citizens and responsible taxpayers.

 - Fin24