Prisons graft: Here’s the proof, minister

On Sunday the Department of Correctional Services placed expensive advertisements in three national newspapers, urging anyone with proof of impropriety in the awarding of prisons’ contracts to inform South Africa’s law enforcement agencies.

This week we present the proof.

Confidential documents and correspondence leaked to the Mail & Guardian suggest a highly improper relationship between the department and controversial facilities management group Bosasa.

We can reveal that Bosasa, which has received nearly R3-billion in contracts from Correctional Services Minister Ngconde Balfour’s department:

  • Had confidential documents leaked to it by the department’s former chief financial officer and Balfour confidant Patrick Gillingham;
  • Had access to tender documents for major prison projects before they were advertised; and
  • Spied on senior correctional services officials during a 2006 workshop.

Bosasa is headed by Eastern Cape businessman Gavin Watson, whose family had close ties with the Eastern Cape ANC during the struggle years, when the Watson brothers became famous for refusing to play rugby for a whites-only Springbok team.

The group also runs the controversial Lindela repatriation camp for the Department of Home Affairs and has large contracts with the South African Post Office, Airports Company of South Africa and the departments of justice and transport.

The Special Investigating Unit (SIU) has been probing Bosasa since 2006 and raided its offices in December. Three weeks after the raid the
company was re-awarded the massive prisons catering contract it landed in 2004.

The department’s advertisements on Sunday were a reaction to the M&G‘s report last week of alleged irregularities in the awarding of the latest catering tender.

Former prisons commissioner Vernie Petersen suspended Gillingham in September after receiving a preliminary SIU report. Petersen was later transferred to the sports department in what was widely seen as a reprisal for his opposition to Balfour’s attempts to extend the 2004 contract.

Balfour also wanted Gillingham to head the tender committee awarding the new contract, while Petersen insisted that Gillingham not be involved.

2004: A new romance
In 2004 the contract for running prison kitchens was outsourced for the first time. The tender was officially advertised on May 21 in the government’s tender bulletin.

But documents show that on May 1 Bosasa employee and co-founder Danny Mansell sent Bosasa’s operations coordinator, Angelo Agrizzi, papers containing more than 90% of the bid conditions and specifications.

Three weeks later the Department of Correctional Services made available the same document, with the same spelling errors, to the rest of the catering sector.

On August 6 Bosasa was awarded the entire contract, worth R239-million a year, for three years.

The department extended Bosasa’s contract for another year and expanded it to include more prisons, adding R82-million to the bill. It was the further extension that led to Petersen’s clash with Balfour.

In July 2004 the department also gave Bosasa a R1-million tender for nutritional training for prisons’ kitchen staff. Again Mansell sent Agrizzi large parts of the tender document, including bid conditions and specifications, on May 12. The tender was advertised on June 4.

2005: You’ve got mail
The inclusion of CCTV cameras in the catering tender meant that by 2005 Bosasa had a national control centre to monitor the kitchens.

This linked perfectly with its next contract — a R237-million tender for access control and CCTV in 66 prisons. It went to a newly registered company, Sondolo IT, which Beeld revealed in 2006 was 40% owned by Bosasa Operations.

Other shareholders included former president Thabo Mbeki’s political adviser Titus Mafolo and former Strategic Fuel Fund chairperson Seth Phalatse.

On December 17 2004 Bosasa’s IT coordinator, Johan Helmand, emailed Agrizzi certain tender specifications that were to appear in the official bid document published on February 4 2005.

On April 29 Sondolo IT was awarded the contract. In 2005 Agrizzi and Gillingham started emailing each other prison research reports and newspaper clippings. On August 29 Gillingham sent Agrizzi a copy of questions from City Press, put to the department about the Bosasa contracts, the leaked documents show.

On December 9 2005 Bosasa landed a R487-million prisons’ contract for security fencing through a small Cape Town firm, Phezulu Fencing, it had purchased.

There is double proof that the company had privileged information long before the tender was advertised. Three months earlier, on September 25, Agrizzi emailed Mansell a voluminous document containing bid specifications. ‘Please verify and check, we can sit tomorrow am,” Agrizzi wrote.

On October 3 Agrizzi sent a longer version, headed ‘Fence Doc Final”, to the chief executives of Bekaert Bastion and SA Fence & Gate, Michael Rodenburg and Geoff Greyling respectively, under the subject line: ‘Fence Doc Final … Very Confidential …”.

This contained the full bid conditions and specifications published by the department on October 14. Bekaert Bastion supplied cladding material and SA Fence & Gate was contracted to do part of the installation.

This week Greyling ‘categorically” denied seeing a copy of the bid document before it was published. He said: ‘It should be recorded that the tender was based on the standard public works/correctional services specification with which we are well acquainted from previous bids. The prior possession of the tender document by anyone would therefore be of no specific advantage to such person.”

Colette Stofberg of Bekaert Bastion (now called Betafence) replied that ‘years before this contract” Betafence provided technical specifications to the department of public works that were used in this tender.

According to an industry insider the big advantage lies in knowing the quantities required for the tender weeks before your competitors.

On October 10 2005 Agrizzi sent Gillingham a six-page document titled ‘Equipment Specifications & Guidelines”. The same section featured in a tender for a comprehensive tele-vision system, comprising 6 000 TVs for communal cells, published four days later.

On November 28 Agrizzi emailed Mansell the confidential evaluation sheet the department used to adjudicate the TV tender, which Sondolo IT won on March 17 2006.

2006: spies in the house
On February 9 Agrizzi sent Gillingham a document, headed ‘Tender Evaluation Criteria New Waterval”, containing comments on bid specifications for a contract for catering services at seven prisons in the Waterval management area, KwaZulu-Natal.

The tender was officially advertised on May 19. Seven days earlier Gillingham sent Agrizzi the confidential evaluation sheet for the Waterval tender with a message: ‘Hi, Attached please find the reworked evaluation sheet for your comments. You will notice the evaluation sheet for site visits cannot be published and will not form part of this document. Regards, Patrick.”

On September 15 Bosasa Operations was awarded the Waterval catering tender, worth R123-million over five years. On April 24 2006 Agrizzi sent Gillingham a letter in which an anonymous writer asks the chairperson of Parliament’s correctional services, Dennis Bloem, to ‘sort out” the attack on the department by ‘international capitalists” and ‘activist Afrikaner companies”. This week Bloem confirmed receiving such a letter.

On June 21 Agrizzi sent Gillingham a surveillance report of a prisons department security workshop at a Drakensberg hotel in June 2006. The 25-page report makes it clear that the agent was asked to spy on the department’s chief deputy commissioner of security, Willem Damons, and his subordinate, Tonie Venter. The report also contains pictures of people and cars at the hotel, as well as the inside of the conference room.

In his message to Gillingham Agrizzi wrote: ‘I didn’t see the reason/need to email you the rest; nothing actually happened.” Gillingham replied the next day: ‘Hi, Thanks for the report and it seems as if they behaved well during their session. Regards.”

Bosasa’s lawyer, Brian Biebuyck, advised his client not to answer the M&G‘s questions. He warned the M&G to publish ‘at your peril” and said Bosasa would pursue charges of criminal defamation if defamatory material was printed.

The department’s Manelisi Wolela responded that the M&G‘s questions ‘are part of a broader brief given to the SIU” and urged the newspaper to provide the unit with proof of impropriety. Gillingham did not respond to the M&G‘s queries.

Pictures from a confidential surveillance report of a senior Department of Correctional Services meeting in the Drakensberg in June 2006.

Related Documents
Annexure A: Email from Patrick Gillingham to Angelo Agrizzi in which he comments on a report by chief deputy commissioner Willem Damons about a tender for x-ray scanners

Annexure B: Email from Agrizzi to Gillingham with price specifications for TV systems tender published a week later

Annexure C: Email from Agrizzi to Gillingham with suggestions about promoting Bosasa

Annexure D: Anonymous letter to Dennis Bloem emailed by Agrizzi to Gillingham

Annexure E: Email from Agrizzi to Gillingham with evaluation sheet for Waterval catering tender

Annexure F: Email from Mansell to Agrizzi with tender specifications for 2004 catering contract

Annexure G: Email from Mansell to Agrizzi with tender specifications for nutrition training contract

Annexure H: Email from Helmand to Agrizzi with tender specifications for access control contract

Annexure I: Email from Agrizzi to Mansell with tender specification for security fencing contract

Annexure J: Email from Agrizzi to Rodenburg and Greyling with tender specifications for security fencing contract

Annexure K: Email from Agrizzi to Gillingham with tender specifications for TV system contract

Annexure L: Email from Agrizzi to Mansell with confidential evaluation sheets for adjudication of TV system contract

Annexure M: Email from Agrizzi to Gillingham with comments on KwaZulu-Natal catering tender’s request for approval

Annexure N: Email from Gillingham to Agrizzi with evaluation methodology and evaluation criteria sheets for KZN catering tender

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