/ 8 March 2010

Gauteng cans motorsport contract, saves R700m

The Gauteng department of economic development has saved more than R700-million by cancelling a motorsport contract, provincial minister Firoz Cachalia said on Monday.

“I wish to reiterate that the decisions taken on motorsport are aimed at ensuring that we channel all the available resources to our immediate priorities,” he said at a media briefing in Johannesburg.

The remaining two motorsport events for 2010 would, however, continue and would be funded by the provincial government.

The contract is scheduled to end in April.

“In terms of the settlement agreement the provincial government would carry out its obligation to host two events already set down in the 2010 calendar.”

Cachalia said all motorsport contracts were cancelled in a manner that was amicable and would avoid legal action.

In the 2008/09 financial year the department spent R167-million in hosting rights for motorsport events and in 2009/10, R118-million was to be spent.

Although Cachalia did not suspect any corruption in procurement processes of the motorsport contract, a forensic investigation was being carried out in the department.

“I have no information before me which suggests any dishonesty … The forensic investigation is part of responding to recommendations and findings made by the Auditor General and Scopa,” he said.

He made it clear his predecessor, current Deputy Arts and Culture Minister Paul Mashatile, might have erred in deciding to fund the sport.

“In retrospect I don’t think it [motorsport funding] was a good decision. This raises questions about decision-making processes … We will try to tighten up the process.”

He said the benefits of the province hosting motorsport events were inflated and that less emphasis had been put on the price the province had to pay.

The Gauteng Motorsport Company dissolved and its duties in this year’s events were handed to Blue IQ, a company involved in inner-city regeneration. The company had already established a dedicated division to focus on the remaining events. — Sapa