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Zuma: State acting on construction fraud

Feb 15 2013 13:59 Fin24
Jacob Zuma

Jacob Zuma (Picture: GCIS)

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Cape Town - The government was cracking down on corrupt activities by construction companies, President Jacob Zuma said in his State of the Nation address on Thursday evening.

"The state has collected a substantial dossier of information on improper conduct by large construction companies. This is now the subject of formal processes of the competition commission and other law enforcement authorities," Zuma said.

He vowed to act against corruption, tender fraud and price fixing in the infrastructure programme.

The Infrastructure Development Bill has been published for public comment, he said.

Construction firms including Wilson Bayly Holmes - Ovcon [JSE:WBO], Stocks & Stocks civil engineering, Murray & Roberts Holdings [JSE:MUR], Group Five [JSE:GBF], Concor, and Aveng [JSE:AEG] allegedly fixed state and other contracts worth billions of rands.

The companies are said to have fixed projects such as the FNB Stadium in Johannesburg, the Coega development project in the Eastern Cape, Green Point soccer stadium in Cape Town, the Nelson Mandela Bridge in Johannesburg, and the Gautrain.

Executives are reportedly cooperating with police in exchange for immunity from prosecution.

Zuma said the infrastructure development programme had been a "valuable source of learning for government".  He added that the government had learnt to "coordinate, integrate and focus on implementation".

Last year Zuma announced a multi-billion rand infrastructure programme for South Africa that would be spent on roads, ports and railways.

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