Appointment of service providers at core of misconduct claims against UIF execs

Two months ago, Eyewitness News reported that UIF Commissioner Teboho Maruping and chief financial officer, Fezeka Puzi, returned to work after they were suspended for nine months as investigations into the fund’s Temporary Employee-Employer Relief Scheme ensued.

FILE: Unemployment Insurance Fund (UIF) commissioner Teboho Maruping. Picture: @UIFBenefits/Twitter

JOHANNESBURG - As the Labour And Employment Department finalises its disciplinary hearings against top Unemployment Insurance Fund (UIF) executives accused of misconduct, Eyewitness News can reveal that the allegations stem from the approval of deviation processes during the appointment of service providers.

Two months ago, Eyewitness News reported that UIF Commissioner Teboho Maruping and chief financial officer, Fezeka Puzi, returned to work after they were suspended for nine months as investigations into the fund’s Temporary Employee-Employer Relief Scheme ensued.

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The Special Investigating Unit (SIU) report issued after the probe into the appointment of service providers to run radio awareness and advertising campaigns on the Temporary Employer-Employee Relief Scheme (TERS) did not point to any corruption or fraud on the part of Maruping or other staffers involved.

However, the SIU has found that Maruping failed to discharge his duties to ensure that the UIF did not incur irregular expenditure of R6.1 million after he allegedly failed to interrogate the reasons put forward for deviating from competitive tender processes.

According to the document, the bid adjudicating committee at the UIF met in April last year and motivated to deviate from open procurement processes by using the sole provider principle.

However, the SIU investigation has determined that five service providers, including major media houses, were in fact not the sole service providers.

But in the report, Maruping explained that he approved the deviations and ultimate awarding of the tenders based on recommendations of the bid adjudication committee, director of supply chain and management and the chief financial officer, who were, according to him, experts in this regard.

MISUNDERSTANDING OF SOLE-SOURCE PROVIDERS

The SIU said that UIF officials “misunderstood” the meaning of sole-source service providers when recommending and approving deviations from normal tender processes last year.

Last year, as the country rushed to procure services to deal with the effects of the COVID-19 pandemic Treasury issued a directive, saying that accounting offices and authorities and government institutions must only deviate from inviting competitive bids in cases of emergency and sole supplier status.

Although the directive was repealed after Treasury realised it was being abused by some in government, the UIF relied on it to deviate from the normal tender processes to acquire ad space in media houses across the country.

At the time, the UIF was hard-pressed to roll out the Temporary Employee-Employer Relief Scheme, a process that was rooted in awareness about the program in the labour market.

However, the SIU flagged the fund's reliance on the sole supplier status to deviate from regular tender processes, saying it was not fair, equitable, transparent, competitive or cost-effective as prescribed in the Constitution as prescripts of the Public Finance Management Act.

The unit's report states that evidence from the UIF communication and marketing department, supply chain management and the entire bid adjudication committee misunderstood the meaning of sole-source service providers when recommending the deviation process.

The SIU said that the actions or omissions by Commissioner Maruping and others resulted in R6.1 million in irregular expenditure.

The COVID-19 TERS programme is valued at R61.1 billion.

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