Gauteng Health MEC Bandile Masuku. Picture: Jacques Naude/African News Agency(ANA)
Gauteng Health MEC Bandile Masuku. Picture: Jacques Naude/African News Agency(ANA)

Two dodgy Gauteng health tenders canned in two months

By Baldwin Ndaba Time of article published Aug 4, 2020

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Johannesburg - Gauteng Treasury, under MEC Nomantu Nkomo-Ralehoko, was yet again allegedly instrumental in blocking another unlawful awarding of a multimillion contract by the provincial Health Department during the tenure of Health MEC Bandile Masuku.

This coincides with another similar intervention by provincial Treasury when it red-flagged more than 102 companies that were illegally awarded contracts to supply personal protective equipment (PPE) to the provincial government - contracts that annoyed the ANC and Premier David Makhura.

These latest details are contained in Masuku’s written replies to questions put to him in the Gauteng provincial legislature by DA health spokesperson Jack Bloom.

The shocking revelation of the illegal awarding of a R140million contract to Impela Alliances emerged after Bloom asked Masuku whether his department had appointed the same company to assist with financial reporting and accruals in his department.

In his written reply dated June 21, Masuku confirmed the appointment of Impela and said they liaised directly with different senior managers in his department.

“The total cost of the contract was to be R140000000 for a period of 18 months,” Masuku said.

Detailing reasons for the appointment, Masuku said: “There were capacity constraints in supply chain management (SCM) in terms of skills and expertise (in his department).”

He admitted that his department bypassed normal procurement procedures in the appointment, which drew the ire of the provincial Treasury.

“The appointment was a deviation from normal SCM processes. Post the appointment a request was made to Gauteng provincial Treasury to approve the deviation, which was declined. This, therefore, meant the transaction was non-compliant and any payments processed against it would be irregular expenditure,” Masuku said.

He indicated that a legal opinion was sourced on how to remedy the situation, and that the opinion provided was that the contract should be terminated “after paying all services rendered to date”.

Masuku said his department was in the process of paying Impela for services rendered.

According to documents, Impela was paid R17.2m in tranches of R8629600 for May and June - on June 25. Bloom said: “I am astonished that this hard-pressed department wanted to waste R140m on something that could easily have been done internally. Instead of paying a consultant, this huge amount of money would have been better spent paying off suppliers who have been waiting for their money for months and years,” he said.

“I suspect that this very fishy contract was only cancelled because I asked questions about it in the Gauteng legislature.

“Why were normal tender processes bypassed for such an inflated amount? It is yet another example of financial mismanagement in a department that now faces the Covid-19 crisis but has yet to prove that it has moved beyond the scandals of the past.”

He added that Gauteng Health had a history of project management companies being paid huge amounts for work that could be done internally.

“It is very suspicious and needs thorough investigation. The rot runs deep despite many promises to fix it,” Bloom said.

According to company records, Impela was owned by Sipho Majola and Ntobeko Majola, formerly Bhengu.

Sipho said he was challenging the department’s decision to terminate their contract.

Majola, however, referred all other enquiries to his lawyers when questioned about his company profile, including failing to comply with tax obligations.

The company was initially registered in November 2002 with its headquarters in Midrand.

In October 2003, the name was changed to Ilembe Fleet and two new directors were added, Ntobeko Bhengu and Sipho Majola.

In 2010, the company was due to be de-registered for non-compliance of its annual return, and applied for non-compliance restoration in 2011.

In 2016, it was again in the process of de-registration due to returns non-compliance. In 2017, Bhengu changed her surname to Majola and the company name was changed to Impela Alliances.

At the time of publication, Majola’s lawyers had not responded to requests for comment as suggested by Majola.

Political Bureau

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