The new tender for the controversial project was cancelled three days before the finalisation of a major tender to install Internet-connected computer labs in the province’s public schools.

At a media conference on Tuesday, Gauteng finance minister Mandla Nkomfe said the department had decided to review the project “to incorporate a comprehensive e-learning aspect which was not part of the existing scope and merge the programme on the Gauteng Broadband Network once it has been built,” said Nkomfe.

Last month, the Mail & Guardian reported that the politically connected SMMT, now trading as Cloudseed, had failed to deliver on the original R2bn tender.

The tender was readvertised on 18 January and, despite its poor track record, there were fears that Cloudseed would again win the contract, which was allegedly framed in such a way as to favour the company.

The original five-year Gauteng government tender to install Internet-connected computer laboratories in 2 200 schools expired in December. However, according to official figures 548 schools still lack functioning facilities. Many more schools have abandoned the facilities, saying they are unusable.

Both the Democratic Alliance in Gauteng and a number of school governing bodies objected that the specifications in the readvertised tender, which require the project to be completed within four days, gave Cloudseed a headstart.

Labelling the project a flop, critics have called for it to be scrapped. Cloudseed has responded that the project is delivering on its mandate.

The new tender specified that the “successful bidder must demonstrate his or her capability to deploy a replacement solution on 1 April, ensuring zero interruption of service to the users”.

Prospective bidders complained that that the service is already being delivered on Cloudseed infrastructure. This implied that a new contractor would have to remove the existing equipment to install a new system and that Cloudseed could switch off the network whenever it chose to.

Another complaint was that bidders were given too little time to assemble bids as the tender closed on 18 February. Evaluation was due to be finalised on 22 March.

The new contract could be worth billions of rands.

DA finance spokesman Mike Moriarty commended Nkomfe’s boldness in cancelling the tender, adding that the new strategy was an improvement on previous contracts, which had squandered R3bn.

But Moriarty added: “The department should have never been in this situation in the first place. I don’t know whether it is incompetence or corruption.”

Finance department spokesman Desiree Ntshingila said the department would continue with a month-to-month contract with Cloudseed until a new tender is issued, to avoid interruption.