It appears to have contravened the PFMA by not advising National Treasury within the stipulated time about contract awards that deviate from normal bidding processes.
The Sanral head office in Pretoria, 27 May 2021. Photo: Neil McCartney
The extent of the rot in the procurement system of the South African National Roads Agency (Sanral) has been exposed in a legal opinion prepared for the agency.
An informed source provided Moneyweb with a summary of the legal opinion, which was prepared for Sanral following review applications launched in the High Court in Pretoria by Botle Ba Africa Roads and BCB Solutions to a routine road maintenance (RRM) panel tender.
These high court applications follow Sanral issuing a tender for RRM in November 2024, which closed in January 2025.
It reduced the panel of contractors from more than 300 companies to 13, with plans to add 20 more companies, for a period of five years, covering contracts countrywide.
PFMA contraventions
An investigation by Moneyweb has also revealed what appears to be contraventions of the Public Finance Management Act (PFMA) by Sanral in relation to emergency procurement awards that were not subject to a competitive bidding process.
There were six other applicants to the Bottle Ba Africa application, which cited Sanral and 22 contractors as respondents. Moneyweb was unable to gain access to BCB Solutions’ application.
The validity of the tender was extended twice, to 22 June 2025 and 22 August 2025, but there is no evidence that Sanral obtained the consent of bidders for these extensions.
The legal opinion details significant alleged irregularities, procedural deficiencies, legal concerns and serious lapses in governance and transparency.
It states that there is prima facie evidence of misconduct, including the awarding of contracts to non-existent or deregistered entities, as well as a lack of verifiable contact details. It also notes that Sanral has not provided contact details or addresses for all bidders despite requests.
In addition, it found material irregularities in compliance with internal tendering procedures, including tenders being opened late and not providing a tender opening register.
It further states that the “deadlocking mechanism” does not comply with the Preferential Procurement Policy Framework Act (PPPFA) and that price competition did not take place “at any stage”.
It found that Sanral’s tender process conflicted with legislative requirements, especially regarding price and preference points, and that the reduction in the number of contractors from more than 300 to 20 was irrational.
Inconsistencies were also identified in the lists of final panel members and the decision-making process, with meeting minutes reportedly missing.
Missing documentation
Further documentation irregularities included 51 bidders on the non-compliance list who are missing from the files, raising doubts about overall compliance, the legal opinion stated.
It also said no records of bid evaluation committee (BEC) or bid adjudication committee (BAC) meeting minutes exist for certain periods, in breach of supply chain management (SCM) policies.
In addition, no minutes or records of contracts committee meetings or board resolutions are available, and signed service level agreements with successful bidders are also missing.
The legal opinion recommended Sanral should thoroughly investigate and address governance failures, misconduct and irregularities, including:
- Identifying and disciplining officials involved in fraudulent or collusive conduct;
- Considering criminal charges against perpetrators;
- Providing detailed reports on procedural lapses, causes and remedial measures;
- Ensuring compliance with procurement laws and internal policies;
- Addressing irregularities, including deregistered companies on the list;
- Analysing and improving procurement processes to prevent future lapses; and
- Considering a just and equitable remedy to restore fairness and transparency in procurement.
Self-review and settlement considered
It is understood Sanral is now considering launching a high court self-review application to set aside the tender and also plans to seek a settlement with Botle Ba Africa, BCB Solutions and the other bidders involved in the two matters.
Moneyweb emailed a list of questions to Sanral related to the high court challenge and the legal opinion.
Sanral media relations manager Lwando Mahlasela confirmed that high court applications relating to the roads agency’s RRM contractor panel established in 2025 were launched by Botle Ba Africa and BCB Solutions, but indicated the panel has not been utilised since, pending the conclusion of the current litigation process.
However, Mahlasela issued the same response to four questions, stating: “Due to the current litigation in progress, the matter is sub judice and Sanral can therefore not comment further or in any detail.”
These questions related to whether:
- Sanral was considering or has launched a self-review application to set aside this tender;
- It is considering a settlement with the applicants in the cases launched by Botle Ba Africa and BCB Solutions; and
- It is considering or has laid criminal charges against its chief procurement officer Khomotso Mhelembe, and two general managers in the procurement office who reported to Mhelembe, and if so, when they will appear in court.
Mhalembe was placed on precautionary suspension for the second time on 29 April 2026 by Sanral’s board, together with two other general managers. The names of these two general managers are not known.
The Botle Ba Africa and BCB Solutions applications were scheduled to be heard in March this year but were postponed because of disputes over the completeness of the tender record, including key documents such as the SCM manual, bid submissions and meeting minutes.
The legal opinion states that the irregularities and missing records highlight governance issues and procedural non-compliance, adding that this situation requires urgent instructions to resolve the record dispute and address procurement irregularities.
Riaan du Plessis, an attorney representing Botle Ba Africa and the other six applicants in that matter, said in a founding affidavit that Sanral changed its business model in relation to the employment of contractors.
Instead of using a pool of around 300 contractors, Sanral opted for a single panel of 20 contractors.
Du Plessis said that this, in itself, may not necessarily be a problem; however, what is problematic is the manner in which Sanral conducted the tender and appointed the panel members.
He claimed the process contained serious irregularities, which render it inconsistent with the SA Constitution and the PPPFA, and the tender is ultra vires and violates the rule of law.
Du Plessis further stated that the tender is irrational as it does not advance, nor can it achieve, legitimate governmental objectives associated with proper public procurement processes, including a competitive and cost-effective tender that saves taxpayer money and a non-discriminatory process that treats all bidders fairly and does not unfairly discriminate on the basis of race.
Emergency contracts raise fresh questions
Meanwhile, Moneyweb submitted a query to Sanral on 19 March 2026 regarding emergency procurement awards made by the roads agency without a competitive bidding process from 1 January 2025 to date.
A partial response was received on 11 May 2026; however, a question regarding the value of each of these projects has still not been disclosed after almost three months.
Sanral’s Mahlasela confirmed that the awards were made in line with the emergency process prescribed by National Treasury and adopted by Sanral in its Procurement Procedure Manual.
Mahlasela said Sanral in the past appointed RRM contractors following a standard operating procedure that allowed the appointment of the nearest RRM contractor without any tender process.
He said the majority of the current RRM contracts were appointed using this method, but following a review of the SCM policy in 2024, National Treasury prescripts on emergency procurement were adopted to ensure inclusive procurement and to avoid evergreen contracts.
Mahlasela confirmed that all procurement done through deviations from competitive process have been reported to National Treasury and are available for the Auditor-General to audit “as and when required”.
Mahlasela provided Moneyweb with a spreadsheet listing 52 emergency procurement projects, including the dates on which the awards were made and the names of the appointed contractors, but not the value of each award.
Treasury contradicts Sanral claims
Moneyweb sent a copy of Sanral’s spreadsheet to National Treasury and asked it to confirm the date on which it was notified by Sanral of these awards.
National Treasury said only five of the 52 transactions had been reported by Sanral and that there was “no evidence” that the remaining contracts had been disclosed to the Treasury.
In addition, National Treasury said only three of the five transactions were reported by Sanral to National Treasury within the stipulated time.
“In terms of section 6 of PFMA SCM Instruction 11 of 2025-26, Sanral is required to report procurement by other means, 30 days from signature date of contract extension.
“Section 4 and 5 of PFMA SCM INSTRUCTION NO 03 OF 2021_22 also require Sanral to report deviation from normal bidding process and contract variations within 14 days after finalisation of procurement by other means and on a monthly basis, respectively.”
National Treasury further confirmed there is no evidence that contract awards to Rainbow Civils and Vea Road Maintenance and Civils were submitted to National Treasury.
Moneyweb submitted this query because it was informed that a significant portion of the total value of these contract awards were to these two companies.
Moneyweb did not receive either an acknowledgement or response to emails sent to Vea Road Maintenance and Civils and Rainbow Civils on 2 June 2026 requesting them to provide information on the total number and value of emergency procurement contracts they had been awarded by Sanral from 1 January 2025 to date.
Moneyweb has published several articles since last year related to a legal challenge by Hillary Construction to the award of the R1.57 billion Masekwaspoort tender to the China State Construction and Engineering Corporation (CSCEC), in a joint venture with Base Major.
Spotlight on procurement process
Sanral has applied to the High Court in Pretoria for an order declaring unlawful and setting aside the award and to start this tender afresh after its investigation revealed the award was marred by a host of irregularities that collectively undermined the lawfulness, rationality and fairness of the procurement process.
However, Sanral has denied there is a need to also investigate and cancel the award of the R1.57 billion contract for the upgrade of the R61 from All Saints to Baziya that was awarded to the same joint venture on 28 November 2024, a day after its award of the Masekwaspoort tender to the same JV.
Sanral’s Mahlasela said Moneyweb’s queries about this tender fall outside of the Masekwaspoort tender and court proceedings and “are speculative”.
“Sanral is committed to legality, transparency and fairness,” Mahlasela said at the time.
Creecy signals need for reform
Transport Minister Barbara Creecy confirmed to Moneyweb during an exclusive interview last month that she is worried about Sanral’s entire value chain in its tendering system, particularly as the Auditor-General has found a high level of irregularities.
“It’s how we put out tenders, the speed with which we put them out, the speed with which we turn them around, compliance issues, the whole lot.
“That is one of the reasons why when I was considering who do I make the chair [of the new board], I considered that in this particular three-year term it might help to have someone who has a strong accountancy background as the chair because there is clearly a lot of work we have to do around compliance,” she said.
This article was republished from Moneyweb. Read the original here.
