MEDIA RELEASE
SANRAL assures public of good governance
Pretoria, 1 August 2024 – The South African National Roads Agency SOC Limited (SANRAL) has noted reports published by certain media houses this morning without contacting SANRAL for comment. Some of these media reports quote analysts who clearly do not have an informed understanding of SANRAL’s governance processes and the laws that govern those processes. Regrettably, their uninformed assertions may cause undue alarm. Therefore, SANRAL would like to assure the public that its Board continues to exercise good governance despite vacancies that recently occurred on the Board and has acted to ensure that tender decisions continue to comply with the law.
SANRAL spokesman Vusi Mona said: “The SANRAL Board wants to assure the public and all our stakeholders that good governance is at the core of its fiduciary duties and it has taken all the necessary steps to ensure that the current vacancies on the Board will not negatively affect governance. As outlined in the SANRAL Stock Exchange News Service (SENS) announcement released on 31 July 2024, the Board has reconstituted its sub-committees to ensure continued good governance and compliance with the legal framework.”
Regarding concerns raised in the media about the potential impact on the adjudication and awarding of tenders, which is crucial for jobs and socio-economic benefits in the construction industry, SANRAL assures the public and business stakeholders that tender processes will not be delayed by the temporary suspension of the Board’s Contracts Committee.
“In terms of SANRAL’s procurement processes, the Management Bid Adjudication Committee (MBAC) adjudicates all tenders. This is a management function in which the Board is not involved. All tenders below R750-million are finalized by MBAC. Due to materiality considerations, contracts above R750 million are referred to the Board’s Contracts Committee for review before being referred to the full Board. Contracts above this threshold are few in any given year.”
Mona further explained: “The fear that the temporary absence of the Contracts Committee will delay the awarding of contracts is misplaced. At any rate, contracts that have been reviewed by the Contracts Committee would still need to serve before the full Board during its normal sittings, in line with the SANRAL Act which requires that all decisions of the Board committees are referred to the Board for ratification and/or approval before implementation. All that this temporary arrangement means is that, instead of tenders in excess of R750 million serving before the Contracts Committee prior to going to Board, they will now go straight to the Board.”
Also, the temporary suspension of the Contracts Committee, occasioned by the two vacancies that have arisen, will not impact the approval of the designated awards (+R750 million) as the Board will adjust its schedule to ensure that there are no unnecessary delays.
SANRAL is resolving the issue of the two Board vacancies with its Executive Authority. The current changes are all temporary pending the filling of the two vacancies, meaning the Acting Chairperson of the Audit and Risk Committee will revert to her position as Chairperson of the Contracts Committee once a Chartered Accountant is appointed to the Board. The Asset Liability Committee will be chaired by the appointee nominated by National Treasury and appointed by the Minister of Transport to the SANRAL Board.
“SANRAL would therefore like to assure the public and the construction industry that the Board has taken all necessary measures to ensure continued good governance and effective operational control within and in compliance with the legal framework,” said Mona.
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