The North Gauteng High Court has ruled in favour of the Tshwane municipality and set aside the R2-billion smart meter contract the former ANC administration signed without a proper tender process.
The DA administration for the City of Tshwane said that PEU Capital Partners – the company behind the contract – was initially appointed on a tender to give advice to on how to save money, but the deal soon morphed into something more.
“The DA had pointed out that the tender and the deal was irregular, and would punch a hole in Tshwane’s coffers,” it said.
“We later discovered that National Treasury and the finance minister agreed with our view.”
It discovered that information on the deal was withheld from the public, even as the ANC voted to approve the deal in the council.
“When legal action threatened to expose the rigged tender, Tshwane’s previous administration concluded a sham termination agreement to allow the service provider a quick getaway.”
The termination agreement would have Tshwane pay R950 million as a fee to PEU subsidiary TUMS.
The R950-million payout was interdicted pending the challenge to the original rigged tender.
“This judgment holds all deals between Tshwane and PEU, and its subsidiary TUMS, as unlawful.”
“We also hope the judgment sends the right message to every negligent city manager, every dishonest mayor, and every unscrupulous service provider doing business with government.”