Questions have been raised about the flouting of procurement procedures at Transnet. Acting group chief executive Mohammed Mahomedy took the stand at the Zondo Commission on Wednesday.
Mahomedy revealed details of how several large Transnet contracts were awarded without going through the required procurement processes and key people were never informed of the transactions.
Eyewitness News reporter Barry Bateman has the full report.
Batemen says Mahomedy revealed how the locomotive maintenance deal with China South Rail was irregular.
He explained how, when it finally came to signing off on the deal which would see the procurement of 1 064 locomotives sent to the China South Rail company, it was agreed that Transnet would pay a 20% deposit.
He said this was highly irregular, he did raise objections but it went through nonetheless.— Barry Bateman, Reporter - EWN
He says when it came to the time to pay the 20% over and above the 10% initially paid, Transnet did not have the funds to pay, so China South Rail initiated a penalty clause within the contract and South Africa paid several hundred million rands in penalties. It was then found out that Transnet did have the money to pay China South Rail at the time when the penalty clause was invoked.— Barry Bateman, Reporter - EWN
The suggestion being that there was somehow an agreement to purposefully allow the lapse of the 20%, this resulted in significant kickbacks to officials within that particular company.— Barry Bateman, Reporter - EWN
Click on the link below to hear more on the testimony...