Logistics firm overpaid by R20m

2013-10-20 11:36
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Johannesburg - A report by outgoing Auditor General Terence Nombembe has found that Mpumalanga’s health department overpaid a logistics firm by R20m.

According to the Sunday Independent, Amalgamated Logistics, owned by local businessman Herbert Theledi, was awarded a R2.3bn contract in 2003. This was for the procurement, storage and distribution of pharmaceuticals and surgical equipment. A second contract ran from 2006.

Nombembe found that the company was overpaid in management fees. This in contradiction to its contract which stated the fee would be fixed at 7.75% of the value of the pharmaceuticals.

However, this was increased by the department by 10% to 8.53%.

This latest development follows close on the heels of Nombembe’s recent findings that provinces have blown millions of rands on consultants.

In his recent report, Nombembe said that the Mpumalanga health department had spent a total of R5.06bn on consultants and that some of the permanent health department staff moonlighted as contract staff for consultants.
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