Former senior KwaZulu-Natal health officials colluded to ensure their preferred supplier received a multimillion-rand award to supply the department with two radiotherapy machines without following supply chain management (SCM) processes nearly eight years ago.
An investigation by the Sunday Tribune has revealed how officials were dismissed and the matter handed to the Specialised Commercial Crimes Unit, SA Revenue Service (Sars) and the Asset Forfeiture Unit, yet nothing was done.
According to a report seen by this newspaper, the dismissed officials had procured the radiotherapy machines in 2008 under “emergency processes” and authorised that the tender be closed and restricted to only four providers.
The report lays bare years of unanswered questions about the machines and unravels how officials went as far as rushing payment to the supplier despite no confirmation of delivery notes or serial numbers confirming the correct machines were purchased.
In addition, the report also found that the officials:
* Processed more than 90% of the payment for the machines worth more than R93 million - five days after the supplier won the tender, yet the company, Tecmed Africa, had to still order the goods from Japan.
* Paid Tecmed for goods before delivery - a violation of SCM processes.
* Payment was made into a third-party account that was not part of the contract with the department.
* There was no written approval to treat the invitation of bids as an emergency under SCM.
* There were no written criteria as to why only four bidders were invited and others were excluded from the bids.
* Assistance by department officials was given to Tecmed asking it to “adjust” its bids and submit the following day, while no such assistance was provided to other tendering parties, including Philips.
A subsequent appeal by Philips following the tender award to Tecmed was not forwarded to the Bid Appeals Tribunal. Instead, the official who awarded the tender and who also requested Tecmed “adjust” its bid handled the appeal himself, in breach of SCM procedures.
The official subsequently responded to Philips, dismissing its appeal in violation of procurement processes. The appeal should have gone to another person not involved in the tender-awarding process.
The investigation into the controversial tender was ordered by former Department of Health HOD Dr Sibongile Zungu who, at the time, also put the brakes on the maintenance contract for the machines, citing concern around the contract.
Zungu also asked why the department had to pay R120m for new machines and R455000 a month for five years for a separate maintenance contract - leading to the machines not being serviced. She also raised concerns that the department may have been sold machines that were not new - a statement later confirmed by Dhlomo. Tecmed disputes the allegations. “The machines installed by Tecmed Africa were new and we have all the proof of new machines being delivered to the department. Our company was given an order with a 5-year maintenance plan. Unfortunately, the department stopped paying the maintenance contract after two years and we stopped servicing the machines eight months later.
“We also dispute that incorrect bank details were provided. Only on one invoice was the incorrect VAT number displayed. This was corrected and payment made correctly on further invoices,” said Tecmed executive chairperson, Werner Begeré.
A source close to the investigation has warned of major repercussions for political figures. “It will blow their cover and expose the rot once it is out,” said the source.
However, the NPA has remained mum on its progress of investigations. It also did not reply to questions sent by The Sunday Tribune. Instead, provincial Director of Public Prosecutions Advocate Moipone Noko would only say they were guiding police investigations.