Probe into Gauteng health’s ‘dodgy’ R1bn contracts

2010-06-04 18:08

Deputy President Kgalema Motlanthe and Justice Minister Jeff Radebe

have authorised a Special Investigating Unit (SIU) probe into alleged fraud and

corruption worth over R1 billion in the Gauteng health department.

The investigation

is to focus mainly on the tenures of former health MEC Brian Hlongwa and

department head Sybil Ngcobo. All deals and contracts concluded between January 2006 and last

month will be scrutinised.

The DA’s Gauteng health spokesperson Jack Bloom has asked for

Hlongwa’s role to be investigated as these deals happened on his watch.

Among the major deals to be probed is the awarding of a smart card

tender to KOPM Logistics at a price of R609 million. A Price Waterhouse

Coopers Consortium bid for this contract was R440 million while Lifesense

Clinics bid at R505 million.

Also under

investigation is the controversial R273 million extention of 3P Consulting’s

contract, which was declared valid by the South Gauteng High Court last year

after the department accepted the Auditor-General’s recommendation that it be

reviewed. The department is

appealing Judge Colin Lamont’s decision.

3P Consulting’s

initial contract, for the establishment of a project management unit, was valued

at R60 million and awarded in July 2007.

The SIU will probe

whether payments to 3P were “not fair, equitable, transparent, competitive

and/or cost-effective”.

The probe will also focus on allegations of:

» Serious maladministration;

» Improper or unlawful conduct by

departmental officials;

» Unlawful appropriation and expenditure

of public money or property;

» Unlawful, irregular and unapproved

acquisitive act(s), transaction, measure or practice having a bearing upon state


» Intentional or negligent loss of public

money or damage to public property.

Another contentious tender is a contract of R48 million awarded to

African Ultra Violet for ultra-violet irradiation units in 12 hospitals in the


The company that scored the highest technical points was prepared

to do the job for R15 million, according to the DA’s Bloom.

Bloom said he was very encouraged by this probe. “It’s essential that there’s accountability and that we try and get

back some of the money that was wasted.”

Other contracts to be investigated, the value of which City Press

could not establish, include the setting up of local area networks in 134 health

facilities and the hosting of the two-day Gauteng Aids Conference in November


The awarding of the contract to upgrade the Chris Hani Baragwanath

Hospital’s surgical division in October 2008 will also be probed.

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