The Minister of Health, Dr Aaron Motsoaledi, has welcomed the release of a forensic report on the Pressure Swing Adsorption (PSA) oxygen plant tender, which among others, has made recommendations for disciplinary action to be taken against all individuals implicated in wrongdoing in the awarding of the tender.
The findings and recommendations of the investigation by PricewaterhouseCoopers (PwC) were released on Tuesday by Public Works and Infrastructure Minister, Dean Macpherson.
The tender in question, worth R836 million, was intended to deliver life-saving PSA oxygen plants to 60 hospitals across the country, which were meant to ensure a reliable and sustainable supply of oxygen, particularly in response to the COVID-19 pandemic. R528 million of this project had been allocated directly to the Independent Development Trust (IDT) -- a public entity that operates under the supervision of the DPWI -- for implementation.
After the release of the forensic report, the Department of Health said Minister Aaron Motsoaledi has expressed satisfaction that "the cloud hanging above the tender" would finally be removed.
The investigation revealed systemic procurement irregularities, fraud and governance failures within the IDT. The inquiry was prompted by the IDT’s admission last year that three companies were awarded the tender, even though two of them did not have the necessary registration with the South African Health Products Regulatory Authority (SAHPRA).
In addition, there are allegations that one of the companies may have submitted fraudulent documentation.
In one example, the investigation found that the original Department of Health budget for the project was R216 million. Still, when the IDT issued the request for quotation (RFQ), prices ballooned to over R590 million without documented approval or value-for-money assessment.
READ | Macpherson outlines report recommendations on R800m oxygen plant tender
The report recommends disciplinary action against IDT CEO Tebogo Malaka, General Manager for Supply Chain Management Dr Molebedi Sisi, and other officials.
Macpherson has since written to the Hawks, briefed the Minister of Health, and met with the newly appointed IDT board to initiate consequence management.
The Department of Health said Motsoaledi also appreciates that those who broke the law will be held accountable.
“They did not just commit financial corruption but deprived South Africans of urgent life support in the form of oxygen. As such, the Department of Health would like to see people being held to account and the law taking its course.
“It must be noted that when this story of the possibility of corruption broke out in the public media, the Minister of Health, in consultation with the Minister of Public Works and Infrastructure, immediately took a decision to remove the tender from the IDT and took it to the DBSA [Development Bank of Southern Africa] so that the project can continue and deliver the much-needed oxygen,” the Health Department said.
Motsoaledi expressed satisfaction that the Department of Health “lost nothing" and confirmed that all funds donated by the Global Fund are secure.
“It would have been a sad day if donor funds were to disappear under our watch.”
The Minister said he was pleased to note a credible forensic investigation had resolved this matter and brought it to a close.
“I am also satisfied that the report has not pointed any fingers at the Department of Health for any financial misdemeanour that may cast aspersions on the integrity of the department, because it would have soured our relationship with the Global Fund,” the Minister said.
With the publishing of the report, the department said the remaining work of the DBSA will be expedited to conclude the project as quickly as possible to the benefit of the people of South Africa. – SAnews.gov.za
