00:00:01
Speaker 1: You're with John Pellman on seven o two. Let's walk the talk. Well, let's turn to that Correctional Services story. The Portfolio Committee in Parliament looking at this particular departments, who were confronted with some very serious and startling numbers. For example, they found that the department had paid between seven six hundred and seventy two rand and seven hundred and twenty six rand for a single liter of cooking oil. The corrected price now has that been bought for either twenty six rand or twenty nine gravy powders. They were paying between two thousand, five hundred and thirty eight rand and three thousand, seven hundred and thirty five rand. I don't know the quantities, but the correct price would have been nine hundred and twenty rand. A department that is absolutely battling to do things with the budget, they have clearly getting fleeced and all of these irregularities passing through the system until somebody picked them up up. The Minister of Correctional Services is Dr Peter Kronavalt, and he joins us now on seven h two drive. Minister, thanks very much for giving us your time when you took up your possession on the third of July in twenty twenty four. I'm sure you would have known from the evidence around Bossasa at the Zondor Commission and many other exposes that procurement was an area with lots of red flags. What steps have you taken since you came into the job to actually make sure that some of these loopholes have been closed? Were the What action have you taken since you put your feet under the desk? Good afternoon to.
00:01:38
Speaker 2: You, Good afternoon, John. Well. Firstly, I must put it very clearly that the PFMA, the Public Finance Management Act, is very clear that no political official or can I say office bureau that includes ministers, are permitted to intervene or to be part of any tender process until everything has been completed and the tender it's been allocated. People must understand that very clearly. That is to prevent corruption. But you ask me what I did as minister, and you're quite right. Although when it referring to the BUSASA scandal and a Deesis scandal, it's not necessarily unperishable and non perishable duds. It's align attempts and I don't want to go into that. But what I did is that. And it started with the bright bread prices. Now on the ninth of May, I intervened or no, I did not intervene. I then started ask, and I want a full report on the bread price. And to make a long story short, we paid a consumer price of twenty four and fifty four a loaf of bread. I then said, but it's totally unacceptable. We must get the best price to the benefit of correctional services and the taxpayers of South Africa. And that's why we also have our own bakeries and we're expanding those bakeries to save money. The previous financial year on bakeries alone, we are going to have another seven by the end of twenty eight. We already saved the taxpayer seventy seven million Rand. Comming back to the Portfolio committee. Yes, firstly a correction and it was made in the Portfolio Committee. The National Commissioner, who is the accounting officer, corrected the figure for insults on the oil. It referred to as you set up to seven hundred I think sixty nine rands. And it's said there on the document one leader. It's not one leader. That wasn't at the strait of error. It was for twenty five leaders. Now if you take twenty five leaders, it brings it down to city land. So that was said in the committee, and it is a pity that that specific example is now being used to say the inflated price and everything that besides that. Besides that, I immediately said also to the Commissioner, I want to fool explanation and everything, and he is basic. He is compiling a fact a sheet to ensure that everything is based on facts and it won't be presented. And I also said that I'm on record, and I also said that in the committee if there was any wrongdoing, if there was any corruption or anything like that, surely I will act as a minister. I will ask, for instance, the FIU everyone to investigate that.
00:05:05
Speaker 1: Minister. Can I come in and go back to a point you made at the beginning. You correctly point out that under the pfm A you cannot get involved in tenders while they are underway. What I want to understand though, is surely there is ongoing conversation between the Department on the one hand and you and the minister as on the other, and for example, these contracts under which these abuses. Your point about the scale of the abuse is well taken. But nevertheless, these contracts are five year contracts put in place on the first of April twenty twenty five. It's now a year later. Can I ask you a two part question. Were you aware that these five year contracts were actually going to be first of all scrutin a tender process run and then awarded. And secondly, once they were awarded, did you get any feedback on the details. Surely as a minister you can ask for.
00:06:02
Speaker 2: That and I did. As you said. It was the first off April, it was awarded in twenty twenty four, the ninth of May, I had a meeting and with all some of the procurement marriagers and everyone. So I immediately acted and I referred to the breadth tender and I said it must be done with all the tenders and report back now. Also in the Portfolio Committee it was said that you're talking about about four thousand and six hundred contracts yet, so it is an ongoing process. But as you said, it's a five year contract. And let me, for instance, take the example of Escort, where twenty thousand Rand was paid for a broom. It's not just a matter of say Okay, now you're saying someone to jail or whatever the case may be. It's a contract, and if the department has committed to a contract, they might who saw that contract?
00:07:02
Speaker 1: Better hang on a moment, Minister. If the contract contains such obvious abuse, I'd rather use examples from your portfolio than from es COM. So contracts are concluded, and unless the Correctional Services Committee has got this fact wrong, you'll put me right. These contracts came into effect on the first of April twenty twenty five, so use the Ministry surely would have had time. I appreciate there's a lot of contracts to actually scrutinize these details. I'm wondering why this is only coming out in May twenty twenty six.
00:07:35
Speaker 2: No, it had not only come out on that. It was before, but we then presented in June, as you said, twenty six of May. We then made the presentation to the Portfolio Committee. And I mean we didn't start the next or the morning before to compile it. So in other words, there was already there, so that will be part of the fact. She can I say that will appear on my desk.
00:08:10
Speaker 1: Have you in the course of scrutinizing these problematic contracts. Firstly, have you been to the courts? I mean a contract is a contract, but contracts get contested in court all the time. Secondly, the suppliers who inflated the prices, do they continue to be suppliers to correctional services?
00:08:34
Speaker 2: Well? Firstly, if you say contract, can let me give you another example. On the im project, there was an arbitration process. We only finalize that by the end of last year beginning of this year when I became the MINISA under my ministry, so that we can continue also with certain disputes on prices. So what I want to say again, and I think we must be very clear on it. And many people say, well, surely you should have done a can I say, forensic auditing process and everything. My principle is that, of course, if it is necessary, surely we will do it, but we must make sure whether we have a good case, because forensic investigations or auditing processes are very expensive. That's that's players money.
00:09:38
Speaker 1: Yes, but surely that would be money well spent. I take your point that no, no, no, no, you don't do everything.
00:09:47
Speaker 2: No, so of course it will be well spent if it is justified. So if it is justified, I will do it. So let's not jump the gun. Let's get all the time. I'm waiting for the fat sheep, and I can assure you. And let's not start trying to I know it's election year and I know a lot of politicians I want to jump on the wagon and er road. I will be rational. I will act in the best interest of the tax payers to ensure that it is money well spent. But then we must ensure it is money well spent. We can't just well, yeah, it's one administrative problem. Maybe we didn't look carefully into the matter. And now we ask for a forensics.
00:10:36
Speaker 1: Matter, Minister, At what point did the either department or the ministry become aware that there were inflated prices? And the context for my question is simply this. You cannot rush out, indeed and do forensics, but certainly a sampling of contracts may have revealed a pattern. Was there any kind of something done once these five year contracts were concluded more than a year ago.
00:11:07
Speaker 2: Now what I said is, and I started with the bread contract is a good example. Yes, it was also from the first half April. I did that, and he negotiated the prices, and it's easy to refer to inflected prices. The fact is it was in that specific case, it was a consumer price. And as Minister I said, I can't see that the department is pay for the same price as consumers. Surely there should be a cheaper price on that.
00:11:44
Speaker 1: How large was the size of the sample that you did when you reviewed after the first of April contracts were concluded.
00:11:55
Speaker 2: Well, I said, I want on all the perishable and non perish ball programs, and and what.
00:12:02
Speaker 1: What did you What did you find? Minister? What did you find?
00:12:06
Speaker 2: John that that you year when I said, and stop finding waiting for final reports on those contracts. Uh, the one you're referring to now, and what was presented to the Portfolio Committee is one of them. So it came to the end of that and now there will be action and that is what we do.
00:12:29
Speaker 1: Are you concerned that it's taken more than a year.
00:12:34
Speaker 2: Well, of course there are lots of frustration when it comes to administration, because there are processes. For instance, as I've mentioned, let's just take the PSMA. It's not just the matter that I can just intervene. Uh, and you have to wait for certain processes to follow. But the question that should be asked, are you going to wrecked it? That is the question. And the next question is if there was any wrongdoing or any corruption, will you act? And my answer to that is yes, I will, and there will be consequences if it was irregular or whether it was corruption, or whatever the case may be.
00:13:22
Speaker 1: And would you accept minister that A valid third question would be how much money has been lost in the time between the awarding of the contract and the discovery that there was abuse in the pricing.
00:13:36
Speaker 2: Of course, we will ask that question and we will determine that. And as I said to you, our bread prices we brought out from twenty four and fifty to fifteen rand. You can make the calculation what we have saved on that. But besides that, on the bread alone, we also saved the tax by your seventy seven million rand the previous nancial Yeah, thank.
00:14:01
Speaker 1: You so much, doctor Peter Krunabuldt, Minister of Correctional Services. Bringing us to twenty eight minutes past five, I see we've got a couple of you sending voice notes on tenders and indeed on correctional services. Call us with those if you want to respond to the interview with Minister Peter KARUNAVLDT. We will await what facts they come up with with keen keen interest. Twenty eight minutes past five
Speaker 1: You're with John Pellman on seven o two. Let's walk the talk. Well, let's turn to that Correctional Services story. The Portfolio Committee in Parliament looking at this particular departments, who were confronted with some very serious and startling numbers. For example, they found that the department had paid between seven six hundred and seventy two rand and seven hundred and twenty six rand for a single liter of cooking oil. The corrected price now has that been bought for either twenty six rand or twenty nine gravy powders. They were paying between two thousand, five hundred and thirty eight rand and three thousand, seven hundred and thirty five rand. I don't know the quantities, but the correct price would have been nine hundred and twenty rand. A department that is absolutely battling to do things with the budget, they have clearly getting fleeced and all of these irregularities passing through the system until somebody picked them up up. The Minister of Correctional Services is Dr Peter Kronavalt, and he joins us now on seven h two drive. Minister, thanks very much for giving us your time when you took up your possession on the third of July in twenty twenty four. I'm sure you would have known from the evidence around Bossasa at the Zondor Commission and many other exposes that procurement was an area with lots of red flags. What steps have you taken since you came into the job to actually make sure that some of these loopholes have been closed? Were the What action have you taken since you put your feet under the desk? Good afternoon to.
00:01:38
Speaker 2: You, Good afternoon, John. Well. Firstly, I must put it very clearly that the PFMA, the Public Finance Management Act, is very clear that no political official or can I say office bureau that includes ministers, are permitted to intervene or to be part of any tender process until everything has been completed and the tender it's been allocated. People must understand that very clearly. That is to prevent corruption. But you ask me what I did as minister, and you're quite right. Although when it referring to the BUSASA scandal and a Deesis scandal, it's not necessarily unperishable and non perishable duds. It's align attempts and I don't want to go into that. But what I did is that. And it started with the bright bread prices. Now on the ninth of May, I intervened or no, I did not intervene. I then started ask, and I want a full report on the bread price. And to make a long story short, we paid a consumer price of twenty four and fifty four a loaf of bread. I then said, but it's totally unacceptable. We must get the best price to the benefit of correctional services and the taxpayers of South Africa. And that's why we also have our own bakeries and we're expanding those bakeries to save money. The previous financial year on bakeries alone, we are going to have another seven by the end of twenty eight. We already saved the taxpayer seventy seven million Rand. Comming back to the Portfolio committee. Yes, firstly a correction and it was made in the Portfolio Committee. The National Commissioner, who is the accounting officer, corrected the figure for insults on the oil. It referred to as you set up to seven hundred I think sixty nine rands. And it's said there on the document one leader. It's not one leader. That wasn't at the strait of error. It was for twenty five leaders. Now if you take twenty five leaders, it brings it down to city land. So that was said in the committee, and it is a pity that that specific example is now being used to say the inflated price and everything that besides that. Besides that, I immediately said also to the Commissioner, I want to fool explanation and everything, and he is basic. He is compiling a fact a sheet to ensure that everything is based on facts and it won't be presented. And I also said that I'm on record, and I also said that in the committee if there was any wrongdoing, if there was any corruption or anything like that, surely I will act as a minister. I will ask, for instance, the FIU everyone to investigate that.
00:05:05
Speaker 1: Minister. Can I come in and go back to a point you made at the beginning. You correctly point out that under the pfm A you cannot get involved in tenders while they are underway. What I want to understand though, is surely there is ongoing conversation between the Department on the one hand and you and the minister as on the other, and for example, these contracts under which these abuses. Your point about the scale of the abuse is well taken. But nevertheless, these contracts are five year contracts put in place on the first of April twenty twenty five. It's now a year later. Can I ask you a two part question. Were you aware that these five year contracts were actually going to be first of all scrutin a tender process run and then awarded. And secondly, once they were awarded, did you get any feedback on the details. Surely as a minister you can ask for.
00:06:02
Speaker 2: That and I did. As you said. It was the first off April, it was awarded in twenty twenty four, the ninth of May, I had a meeting and with all some of the procurement marriagers and everyone. So I immediately acted and I referred to the breadth tender and I said it must be done with all the tenders and report back now. Also in the Portfolio Committee it was said that you're talking about about four thousand and six hundred contracts yet, so it is an ongoing process. But as you said, it's a five year contract. And let me, for instance, take the example of Escort, where twenty thousand Rand was paid for a broom. It's not just a matter of say Okay, now you're saying someone to jail or whatever the case may be. It's a contract, and if the department has committed to a contract, they might who saw that contract?
00:07:02
Speaker 1: Better hang on a moment, Minister. If the contract contains such obvious abuse, I'd rather use examples from your portfolio than from es COM. So contracts are concluded, and unless the Correctional Services Committee has got this fact wrong, you'll put me right. These contracts came into effect on the first of April twenty twenty five, so use the Ministry surely would have had time. I appreciate there's a lot of contracts to actually scrutinize these details. I'm wondering why this is only coming out in May twenty twenty six.
00:07:35
Speaker 2: No, it had not only come out on that. It was before, but we then presented in June, as you said, twenty six of May. We then made the presentation to the Portfolio Committee. And I mean we didn't start the next or the morning before to compile it. So in other words, there was already there, so that will be part of the fact. She can I say that will appear on my desk.
00:08:10
Speaker 1: Have you in the course of scrutinizing these problematic contracts. Firstly, have you been to the courts? I mean a contract is a contract, but contracts get contested in court all the time. Secondly, the suppliers who inflated the prices, do they continue to be suppliers to correctional services?
00:08:34
Speaker 2: Well? Firstly, if you say contract, can let me give you another example. On the im project, there was an arbitration process. We only finalize that by the end of last year beginning of this year when I became the MINISA under my ministry, so that we can continue also with certain disputes on prices. So what I want to say again, and I think we must be very clear on it. And many people say, well, surely you should have done a can I say, forensic auditing process and everything. My principle is that, of course, if it is necessary, surely we will do it, but we must make sure whether we have a good case, because forensic investigations or auditing processes are very expensive. That's that's players money.
00:09:38
Speaker 1: Yes, but surely that would be money well spent. I take your point that no, no, no, no, you don't do everything.
00:09:47
Speaker 2: No, so of course it will be well spent if it is justified. So if it is justified, I will do it. So let's not jump the gun. Let's get all the time. I'm waiting for the fat sheep, and I can assure you. And let's not start trying to I know it's election year and I know a lot of politicians I want to jump on the wagon and er road. I will be rational. I will act in the best interest of the tax payers to ensure that it is money well spent. But then we must ensure it is money well spent. We can't just well, yeah, it's one administrative problem. Maybe we didn't look carefully into the matter. And now we ask for a forensics.
00:10:36
Speaker 1: Matter, Minister, At what point did the either department or the ministry become aware that there were inflated prices? And the context for my question is simply this. You cannot rush out, indeed and do forensics, but certainly a sampling of contracts may have revealed a pattern. Was there any kind of something done once these five year contracts were concluded more than a year ago.
00:11:07
Speaker 2: Now what I said is, and I started with the bread contract is a good example. Yes, it was also from the first half April. I did that, and he negotiated the prices, and it's easy to refer to inflected prices. The fact is it was in that specific case, it was a consumer price. And as Minister I said, I can't see that the department is pay for the same price as consumers. Surely there should be a cheaper price on that.
00:11:44
Speaker 1: How large was the size of the sample that you did when you reviewed after the first of April contracts were concluded.
00:11:55
Speaker 2: Well, I said, I want on all the perishable and non perish ball programs, and and what.
00:12:02
Speaker 1: What did you What did you find? Minister? What did you find?
00:12:06
Speaker 2: John that that you year when I said, and stop finding waiting for final reports on those contracts. Uh, the one you're referring to now, and what was presented to the Portfolio Committee is one of them. So it came to the end of that and now there will be action and that is what we do.
00:12:29
Speaker 1: Are you concerned that it's taken more than a year.
00:12:34
Speaker 2: Well, of course there are lots of frustration when it comes to administration, because there are processes. For instance, as I've mentioned, let's just take the PSMA. It's not just the matter that I can just intervene. Uh, and you have to wait for certain processes to follow. But the question that should be asked, are you going to wrecked it? That is the question. And the next question is if there was any wrongdoing or any corruption, will you act? And my answer to that is yes, I will, and there will be consequences if it was irregular or whether it was corruption, or whatever the case may be.
00:13:22
Speaker 1: And would you accept minister that A valid third question would be how much money has been lost in the time between the awarding of the contract and the discovery that there was abuse in the pricing.
00:13:36
Speaker 2: Of course, we will ask that question and we will determine that. And as I said to you, our bread prices we brought out from twenty four and fifty to fifteen rand. You can make the calculation what we have saved on that. But besides that, on the bread alone, we also saved the tax by your seventy seven million rand the previous nancial Yeah, thank.
00:14:01
Speaker 1: You so much, doctor Peter Krunabuldt, Minister of Correctional Services. Bringing us to twenty eight minutes past five, I see we've got a couple of you sending voice notes on tenders and indeed on correctional services. Call us with those if you want to respond to the interview with Minister Peter KARUNAVLDT. We will await what facts they come up with with keen keen interest. Twenty eight minutes past five
