Minister of Justice and Correctional Services Michael Masutha announced that he will review all multi-billion rand contracts awarded to African Global Operations (AGO) since 2006.
This follows revelations made at the Zondo Commission of Inquiry into State Capture by former managers of AGO, formerly Bosasa, who testified that the facilities management company paid bribes to former President Jacob Zuma, ministers and senior officials of Correctional Services Department in return for lucrative tenders.
Masutha also served the facilities management company with a 30-day notice to cancel the food contract at its seven prison facilities across the country.
“In light of the testimony made at the Zondo Commission, the DCS made an undertaking that all large-scale contracts would be reviewed,” Masutha told journalists at a media briefing on Monday.
“African Global Operations notified DCS of its intention to apply for voluntary liquidation. Consequently, DCS served African Global Operation with a 30 day notice to cancel the contract for nutritional services at seven management areas (contract HO3/2016). This was the last contract that DCS had with African Global Operations or any of its subsidiaries.”
Masutha said his decision to cancel contracts with AGO also followed announcements by FNB and Absa that they would be closing bank accounts of AGO in February 2019.
Outsourcing Food Services
There are 239 operational Correctional Centres in South Africa with 226 kitchens catering to a population of approximately 162,000 offenders as at end of January 2019, according to Masutha.
“Out of the 226 kitchens, 31 of these provide nutrition services through an outsourced service, where 26 kitchens are being serviced by African Global Operations, with a population of 46,434 offenders (29%) while 112,754 offenders (71%) receive nutrition services in-house,” he said.
“The Department has been outsourcing Nutritional Services since 2004 to various correctional centres through competitive bidding processes.”
Masutha said the 2009 report of the Special Investigating Unit (SIU) recommended that disciplinary action be instituted against the then Chief Financial Officer, Patrick Gillingham and the former National Commissioner, Linda Mti but no criminal proceedings were instituted.
“However, disciplinary proceedings were initiated against Gillingham in 2009 but he resigned,” he said.
Masutha added that to date all “officials who are still in the employ of DCS, who were implicated in acts of impropriety in the testimonies given before the Zondo Commission have been served with notices in accordance with rules of natural justice to show cause”.