|2012 05 30 AllPay raises conflict of interest in R10bn tender|
A MEMBER of the committee that had evaluated Absa AllPay's application for a R10 billion tender to distribute social grants nationally had "irrationally" scored AllPay and she had failed to disclose her business links to a partner of Cash Paymaster Services (CPS), the company that ultimately won the bid.
This is one of four arguments AllPay put to the North Gauteng High Court, which began hearings yesterday into allegations that the tender award process by the SA Social Security Agency (Sassa) was flawed and corrupt.
AllPay is asking the high court to set aside Sassa's choice of CPS, a subsidiary of JSE- and Nasdaq-listed Net1 UEPS Technologies, as a service provider.
It was decided yesterday that previous allegations that CPS had bribed people and used other corrupt methods to obtain former social grant distribution tenders would not be considered in the case as these were untested allegations that had surfaced in the media.
CPS began implementation last month of the new tender, in terms of which it will distribute grants nationwide. About 14.8 million people benefit from the state social grants each month.
Gilbert Marcus, senior counsel arguing for AllPay, which previously distributed grants in five provinces, claimed the committee evaluating AllPay's bid had deliberately lowered the Absa-owned unit's scores with respect to the adequacy of its security infrastructure and financial security.
The evaluation took place last year and applicants were expected to achieve a minimum of 70 percent in scores.
AllPay contends its scores were deliberately lowered from 80 percent to 40 percent.
"Two of the evaluators reduced AllPay's score in every category regardless of whether the relevant issue was raised at the meeting or not," Marcus argued.
One of the topics reduced by a certain Ms Nhlapo was under the heading of financial security.
Nhlapo's pre- and post-oral presentation scores of the company differed but her written explanations did not clarify her reduction of the scores.
AllPay said the irrational reduction of scores, without providing AllPay a hearing, was only discovered when the score sheets were produced in terms of legislation. Marcus said: "It was only then that it became apparent that Sassa was 'keeping something up its sleeve'."
AllPay further argued that Nhlapo had failed to disclose a conflict of interest as a result of her business relationship with Mazwi Yako, the owner of Born Free Investments and a business partner of tender winner CPS.
"Since Mr Yako's company is a business partner of CPS, then Mr Yako has a financial interest in an entity that forms part of a consortium that has submitted a bid in response to the payment service tender."
Sassa, during adjudication, had also failed to assess CPS partners who were responsible for executing 74 percent of the contract for their financial and technical capabilities, while two committees looking into the bid were improperly constituted and did not have the relevant qualified staff, AllPay maintained.
AllPay also argued that Sassa had changed the requirement for biometric validation capabilities at the eleventh hour, mere days before bids were due.