Mthobisi Zondi vs The Star

Complainant: Mthobisi Zondi

Article: Defence official linked to dodgy R108m tender

Date: 25 June 2010

Respondent: The Star

Complaint
Mr Mthobisi Zondi, Deputy Director-General for Defense Logistics (SADF), complains about a story in The Star (16 September 2009) headlined Defence official linked to dodgy R108m tender.
Zondi says that the reporter, Louise Flanagan, refused to use the information she had been given.
He adds that the story also falsely states or implies that:
  • Origin Exchange (OE), the company that was contracted by the Department of Defence (DoD), was inexperienced;
  • Mechem, a subsidiary of Denel, was overlooked in the tender process;
  • He shares a business address with OE; and
  • There were irregularities in the tender process.
Analysis
The story says the DoD appointed a seemingly inexperienced company (OE) to perform the de-mining of unexploded armaments, linking Zondi to OE. The intro says it all: “A top defence force official (Zondi) is linked to a company (OE) that received a R108 million contract for specialized work it doesn’t appear to be qualified to do.”
It must be noted that, save for denying that he shared a business address with OE, Zondi does not specifically complain about this alleged link between himself and OE.
The complaint will now be discussed point by point.
Refused to use information
The principal issue here is the question if Flanagan received the information (which Zondi says he provided her with) in time for publication.
From the documentation provided to our office, it is not clear when the relevant information was communicated to her. The document in question is hand-dated September 7, but it was faxed only on September 26 – to a number that is not even The Star’s.
Our office asked Zondi if he could prove that he sent that document to Flanagan in time for publication. He could not.
This makes it reasonable to accept Flanagan’s word that she did not get the information in time.
Inexperienced company
Zondi says the combined experience of the consortium of companies appointed far exceeded those of all the other companies that tendered, making the reference to an “inexperienced” company untrue.
The Star questions this statement, saying that the record in the Tender Bulletin does not even make mention of any consortium. The newspaper adds that, when asked about OE’s expertise, neither the DoD nor OE referred to a consortium. (This was only mentioned later, the newspaper says – which is, again, reasonably true.) Even to date, nobody has indicated what exactly OE itself is bringing to the deal, the newspaper says.
The following is relevant:
  • The story says that the contract requires details of five years’ ordnance clearing experience, that OE was set up as a shelf company in March 2007, and that the current directors joined in November 2008 and February 2009. Zondi did not dispute this information.
  • Note the word “appear” in the intro – it does not say the company is not qualified; it says it appears not to be qualified.
  • The following sentence is also important: “At the time, neither of the two Origin directors would explain what relevant expertise they had…” If OE did have the necessary experience, one would have expected eager answers to this effect – answers that never came.
  • The question about inexperience was put to the DoD and OE way ahead of publication. (On September 3 the DoD was asked by Flanagan about OE’s track record. This question was repeated on September 8. In addition, an already published article that mentioned the possible lack of experience by OE was sent to the DoD on September 11 for comment.) Despite this, no comment was forthcoming.
Therrefore, the newspaper had enough reason to say OE “doesn’t appear to be qualified” for the job.
Mechem
Zondi says the story falsely states that Mechem, a subsidiary of Denel, was overlooked.
However, the newspaper (correctly) points out that the story does not mention Mechem at all. Mechem was mentioned in another article – but that falls outside the scope of this complaint.
The same business address
Zondi denies that his company (Oak Park Trading 190) shares a business address with OE, but could otherwise not explain the information the newspaper says it had. He blames it on some official who made a mistake or on “faul” (sic) play, adding that “…if Ms Flanagan was interested in finding the truth she would have easily established the proof of res.”
Which is exactly what Flanagan says she did. According to her, the documents at the Company and Intellectual Property Registration Office (Cipro) state that Zondi’s business, postal and residential address is 2 Jessica Place, Kloof, KwaZulu-Natal (a property with two houses on it) – the same address used by OE. Flanagan says she double-checked the relevant hard copy at Cipro in Pretoria.
The newspaper’s sources appear to be impeccable in this regard and there is no reason not to accept Flanagan’s version. Until cleared up by Zondi himself, this matter will remain an issue that the newspaper is more than justified to report on.
Irregularities in the tender process
The Star says it was fair for the newspaper to question the contract since:
  • such a specialized deal (worth more than R100M) is involved;
  • the tender documents called for a contractor with a track record of at least five years (which OE does not have); and
  • there still has not been any explanation from any party about why the tender was awarded at more than R30M higher than the next bid.
These arguments are convincing – taxpayer’s money was at stake and officials had to be held accountable.
Finding
The complaint is dismissed in its entirety.
Appeal
Please note that our Complaints Procedures lay down that within seven days of receipt of this decision, anyone of the parties may apply for leave to appeal to the Chairperson of the SA Press Appeals Panel, Judge Ralph Zulman, fully setting out the grounds of appeal. He can be contacted at khanyim@ombudsman.org.za.
Johan Retief
Deputy Press Ombudsman

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