Controls in place to ensure Transnet deal

Transnet - [*Vx5Abw3TTDrTOhqFlDj-FjcsZhV7OlOrf68vcxQAM1qCoj/TPTlogo.jpg] Transnet - [*Vx5Abw3TTDrTOhqFlDj-FjcsZhV7OlOrf68vcxQAM1qCoj/TPTlogo.jpg]

According to Transnet has implemented a series of governance, control and monitoring measures to ensure that Original Equipment Manufacturers (OEMs) meet the company’s stringent localisation obligations and supplier development commitments.

Transnet has awarded CSR Zhuzhou Electric Locomotive and Bombardier Transportation South Africa contracts for the supply of 599 electric locomotives, while General Electric South Africa Technologies and CNR Rolling Stock South Africa (Pty) Ltd will build and supply 465 diesel locomotives.

CSR and General Electric will be manufacturing from Transnet Engineering’s facilities in Pretoria, while CNR and Bombardier will use TE’s facilities in the Durban.

“The company, which awarded what is now South Africa’s single biggest infrastructure investment initiative by a corporate, is constantly monitoring progress by all the OEMs who were awarded the more than R50bn contract,” Transnet said in a statement on Monday.

In addition, to the normal governance structures, Transnet has set up a special sub-committee of the Executive Committee chaired by the Group Chief Executive.

“At operational level, the company has developed various monitoring tools for the OEMs to provide regular updates on their performance on localisation, including the development of a local content reporting template agreed with the OEMs to update on progress.

“To provide further assurance, Transnet also performs an internal validation process of each OEM’s performance as part of contract management,” Transnet says.

Group Chief Executive Siyabonga Gama has also appointed one of South Africa’s big four auditing firms as governance and performance monitors on the entire project to ensure integrity of information and compliance with various aspects of the agreements.

Transnet has reiterated that the Department of Trade and Industry (Dti) is responsible for local content verification.

The department has appointed the South African Bureau of Standards as its official verification agency. Transnet is in constant engagement with SABS as agreed with the Dti.

In terms of its mandate, the SABS can only pronounce on whether local content has been achieved or not once it has completed the validation process and issued a report.

“All OEMs have staff working at Transnet’s various manufacturing sites. The company is willing and able to facilitate access to information should the department or SABS face any challenges,” Transnet says.



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