Fin24

Gijima in R389m Home Affairs settlement

2011-06-29 13:54

Cape Town - The home affairs department settled out of court with IT company Gijima AST [JSE:GIJ] for a loss of R389m over the cancellation of its controversial contract, director general Mkuseli Apleni said on Wednesday.

The department thus avoided a greater loss of R2.1bn had the contract run its course, he told parliament's home affairs portfolio committee.

"The settlement represents a potential R2bn savings to government as against R4.5bn estimated cost to complete the project," Apleni said.

The sum refers to money already paid up to March 2010 to Gijima and sub-contractors HP and IBM for lease payments.

The contract with Gijima was signed in December 2007, but proved fraught from the start. The company failed to deliver an integrated electronic database for the department to improve security and speed up previously manual application processes.

The initial tender was awarded for R1.9bn two months earlier. Costs for the so-called Who Am I Online project however spiralled to R4.535bn over five years, after items like software licences were included in the deal.

National Treasury had only approved a business case for a contract of R2.234bn.

When the company failed to have key components of the project ready in time for 2010 Fifa World Cup, the department approached the South African Revenue Service to develop a new movement control system.

It also informed Gijima the contract was considered invalid, but the company disputed this. Home Affairs Minister Nkosazana Dlamini Zuma then opted for negotiations to avoid a legal battle and further delays.

 

Comments
  • nebkad - 2011-06-29 14:01

    ok

  • Robnob - 2011-06-29 14:05

    And people wonder why Robert Gumede can afford R50m weddings and R30m "donations" to the Jacob Zuma trial. The day of honest money has been obliterated by the ANC and all the comrades.

  • etafadzwa - 2011-06-29 14:17

    Jaaa neh!!! Taxpayers get shafted L R Centre.

  • CynicBelieve - 2011-06-29 14:18

    Typical over promised, under delivered by Gijima... You're welcome for taking our tax money....NOT!

      StirMonger - 2011-06-29 16:06

      NO No No. They just craferd a contract that the other guys didn't understand.

  • Badballie - 2011-06-29 14:24

    Put Gijima at the top of the list of companies you most certainly do not want to do business with, this is either a perversion of justice or there is something we are not being told, how can a contract with a company that has failed to deliver be legally binding unless its board of directors are also the senior government official currently in power

  • Anonymous Thinker - 2011-06-29 14:34

    If they'd asked the right questions and done their homework properly this costly mistake could've been avoided.

  • Deeteem - 2011-06-29 14:36

    Another "deal" that us tax payers are forced to pay for !! Kan julle niks reg doen nie ?

  • Jou - 2011-06-29 14:38

    How can it be a 2bn saving??????. The contract was awarded. The govermant paid R 389million to Gijima and got nothing it return. That equals a R 389million rand LOSS. Stop trying to blow smoke of our ...... Gijima should be sued for the money they stole.

  • sharpeijane - 2011-06-29 14:39

    What am I missing here? A R389m settlement and still no contract delivered. How is this a R2bn saving? Presumably they have to start from scratch and now the cost will probably be R4bn anyway.........

      StirMonger - 2011-06-29 16:05

      New SA rifmetic

      coconuts - 2011-06-29 17:44

      Gijima should have been sued and they pay the state for non delivery

      Eric West - 2011-06-29 18:13

      It's called "struggle maths".

  • eJay - 2011-06-29 14:40

    eish AST. wat nou

  • Spazman - 2011-06-29 14:41

    Milking the cow, Milking the cow... lala la lalalala Milking the cow Milking the cow

  • Zulfiqaar Khan - 2011-06-29 14:41

    Really old news. This announcement was made in March already. Just because Apleni said it again recently, doesn't mean it's news.

      Kgwadi - 2011-06-29 16:16

      Stand with you.Journalist visited him to repeat it again.ahaha

  • Chief Belebe - 2011-06-29 15:00

    I just dont understand period and it makes me nuts. Why would someone be given money when they dont deliver according to their contract? Its purely nonsense, is it? I hate to say that this is synonymous to the current trading with our Government. This is absurd and i'm livid! Why wasting taxpayers money like that when almost three quarters of the popullation is starving for at least some service delivery to their communities? Who the hell drew up this contract with a stupid close in of paying out millions of rands even when the ultimate project was flawed or never materialised. When will South African be responsible and accountable to their deeds? Certainly someone out there is looking at these developments with a grin on their face readying to follow suit and get paid for nothing, whereby i for one have to file my yearly income returns. Alas!

      StirMonger - 2011-06-29 16:04

      The only sound you will hear is the chink of glasses and "Who's next"

      Nuck Choris - 2011-06-29 18:35

      It is because it is a connected bee company. BEE has cost this country plenty

  • TOLDUSO - 2011-06-29 15:39

    I wonder what kickback Zuma got from this?

  • TOLDUSO - 2011-06-29 15:48

    I wonder what kickback Zuma got from this?

  • Sarcastic - 2011-06-29 16:10

    People who have completed work for Government are waiting 120 day if not more for payment - am I missing something?

  • gazzaz - 2011-06-29 16:35

    Somehow somewhere SOMEBODY has got to put a stop to this ABSOLUTE CRAP, can we not form some kind of a forum???? Does my head in, especially when we are subjected to all sorts of threats from SARS regarding the late submission of tax returns etc...... :-(((

      James Weather - 2011-06-29 18:35

      i agree ... they quick to call you a crook if you dont pay your tax on time but where is all our money going ?????? Definitely not to the poor it looks like .....

  • AraBilly - 2011-06-29 19:29

    Follow the money - probably a family connection ... or am I just being unneccessarily sceptical?

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