In 2013, South Africa witnessed one of its greatest corporate scandals when the construction industry’s cartel was exposed.
The Competition Commission’s investigation, going back to the apartheid days, uncovered 300 rigged projects worth a total of R47-billion: R28-billion for public infrastructure projects and R19-billion for private infrastructure.
Rigged projects included roads and bridges, stadiums and housing complexes, university residences and convention centres, factories and office blocks, shopping malls, dams and mining infrastructure.
It emerged that an Old Boys’ Club kept a “black book” in which it kept a score of what infrastructure project had been divvied up to who, all the while raking in profits and bonuses.
The “black book” was to make sure that contracts were awarded in such a way as to maintain the existing markets shares of the companies in the cartel. The black book was controlled by various executives over the decades.
Affidavits before the National Prosecuting Authority detail how the cartel was run, how future company executives were groomed and taught how to collude and how deeply entrenched this practice was.
Up to now there has been little accountability; with miniscule admission of guilt fines paid and implicated executives remaining anonymous and continuing on in their positions.
The lack of real accountability is an indication of the impunity of “White Capital” and its pernicious hold on the country’s economy.
The construction firms and their executives mostly believe that they did nothing wrong, that no one was actually hurt (victimless crime) and that the Commission’s investigation was a “witch hunt”.
“We paid the fine, now leave us alone,” is the general attitude; some executives even admit that they were involved in bid-rigging in the 90s, but don’t see this as a reason why they should no longer hold their powerful positions in the industry.
These are facetious arguments and should be rejected with contempt.
The media discourse around corruption and collusion centres mostly on government graft. This project aims to disrupt that narrative and instead focus on corporate collusion within the economy by exposing who the culpable executives were and also highlight how their actions affected the communities surrounding the infrastructure. We aim to show, in other words, that the crimes had victims, real people with flesh and blood.
On this project The Con conducted an investigation into the social, real-life impact that price collusion has had on the infrastructure built and how communities have been directly affected.
There will be an investigation of the socio-economic circumstances and challenges facing these communities . We will look at the differentials of the rigged cost of the infrastructure against its “real” market price. This exercise is meant to point out how that money could have been spent – especially in instances of government projects – to better the lives of affected communities.
In doing so we hope to remove this issue from the business pages of newspapers-all figures and no people- and give this crime its human face.
Main Pic: Munilall Ramsamujh and his wife, Sonmathey, from 148 Tomango Road in Merebank by Durban Centre of Photography
This work was assisted by a Taco Kuiper Grant from the Valley Trust, administered by Wits Journalism