Johannesburg - The Limpopo Department of Health has awarded a KwaZulu-Natal company a R185 million contract to supply Covid-19 personal protective equipment (PPE) despite it not appearing on the official database of suppliers.
Pro Secure (Pty) Ltd, whose sole chief executive is Durban businessman Ferrel Govender, scored the contract to supply hand sanitisers, according to official documents seen by the Sunday Independent.
Pro Secure is among 216 hand-picked companies which shared Limpopo’s R932m worth of PPE contracts.
The majority of the successful bidders appear to be politically connected individuals, ANC activists and relatives of senior officials and prominent politicians.
They include the 22-year-old daughter of former Limpopo sports MEC Onicca Mokgobedi Moloi, Motlatso Elizabeth Moloi, who scored a R2.2m contract. Moloi and provincial Health MEC Dr Phophi Ramathuba are allegedly close friends and comrades who served together in Premier Stan Mathaba’s fifth administration cabinet.
Most of the beneficiaries are from Vhembe, the home region of Ramathuba, her chief of staff Nyambeni Matshivha and chief financial officer Justice Mudau.
Insiders said the trio, assisted by the department’s manager for supply and demand, Tintswalo Olivia Simango, allegedly manipulated procurement processes to benefit their associates and close comrades before locking all the PPE documents in Mudau’s office.
Other major beneficiaries included Enro Laboratories (R64m), Mizana Trading (R53m), Tsopane Pharmacy (R39m), Clinipro (R30m), Sedilaka Projects (R21.5m), Mmapadi Group (R12.9m), Smandi Projects Management (R14m), Mkhacani Holdings (Pty) Ltd (R12.7m), Ngoako GM Holdings (R17.7m), Pro-Asanta (R10m), Confidence No 1 Trading (Pty) Ltd (R8.3m), RIHM (R7.5m), and Machawana Trading Enterprise (R6m).
Other notable successful bidders were Mmazwi Civil and Construction (R1.7m), Azaniaafrocomedia (Pty) Ltd (R1.7m) and 777 MPS Logistics.
Almost all of the entities do not appear on the Limpopo PPE supplier database, which raises questions about how the provincial health department came to know about them and their services.
According to official documents, the owners of the successful bidders include Avhashoni Edward Matakanye and lufuno Matakanye (Enro), Bhekani Mashaba and Kennedy Liphoko (Mizana), Patrick Bongani Madungandaba (Sedilaka), Tsekiso Tsopane (Tsopane), former Limpopo health department employee Matome Malatji (Mmapadi), Divhamudzimu Aaron Suwani (777 MPS), Mpho Dube (Azaniaafrocomedia), Mpho Lesufi (Mmazwi), Nhlamulo Sharlot Shikwambana and Milton Moagi (Machawana), N Mphephu (Confidence), Nakedi Shane Maela (Ngoako Holdings), Smangele Phalandwa (Smandi), ML Machaka (Afro Asanta) and Theshen Moodley (AG Medical), among others.
The list of cases of procurement fraud, irregularities and nepotism involving PPE contracts in the country is growing.
Sunday Independent previously exposed procurement fraud at the Gauteng Department of Health, including the awarding of a R139m contract to Royal Bhaca Projects, a company owned by the husband of President Cyril Ramaphosa’s spokesperson Khusela Diko, which was also hand-picked.
The Special Investigating Unit (SIU), which is probing multibillion-rand PPE procurement fraud and corruption across the country, has since laid criminal charges against three Gauteng companies and frozen their bank accounts for their role in tender irregularities.
Govender was awarded four contracts in March 18 amid claims that Pro Secure subsequently subcontracted companies owned by relatives of some politicians and departmental officials. Three of its contracts are worth R55.9m each, and another one R7.5m.
The value of his contracts accounts for 20% of the province’s overall PPE budget. An independent company search shows that Pro Secure is based in Morningside in Durban.
A list of Limpopo PPE suppliers shows that Mokgobedi Training and Consulting, a company owned by Moloi’s daughter Motlatso Elizabeth Moloi, scored a R2.2m contract to supply surgical gloves and single bodysuits despite not being on the PPE supplier database.
Moloi yesterday did not respond to a request for a comment.
Ramathuba yesterday denied any friendship with Moloi, adding she was not even aware the former ANC Youth League provincial executive committee (PEC) member’s daughter got a R2.2m PPE contract.
“Let me put it on record that I am not a close friend of Ms Onicca Moloi whom I refer to as Comrade Onicca Moloi. Ms Onicca Moloi is a former member of legislature and a former MEC of sports, arts and culture in Limpopo province. I related with her at a professional level as colleagues focusing on work-related matters. I had never made friendships with her.
“I am also learning from your questions that there’s a company that is for Ms Moloi’s daughter. I was not aware of such as Ms Moloi and myself are comrades in the ANC and discuss politics and not businesses. I do not know much about personal matters of Ms Moloi’s nor her dealings,” she said.
Ramathuba denied instructing her officials to appoint specific PPE service providers, saying the Public Finance Management Act (PFMA) did not allow politicians to get involved in supply chain processes.
“I had no role in the awarding of any contract. The PFMA (where awarding of contracts reside) empowers the HOD and not the MEC. No, I did not instruct the department to appoint any hand-picked company to supply PPEs.”
In a phone call earlier, Ramathuba said she was being subjected to questions she had no idea “where they come from” instead of being allowed to focus on the fight against Covid-19.
She blamed unnamed officials for the irregular procurement process, claiming she too had been demanding answers and was told the department used the three quotation procurement system.
“I also asked questions. How did you get this company (Pro Secure). And they said, no, we were using the CSD where you get in and check your first 10 companies, ask them to quote and take the one with the lowest price. If you look at the province, we are the province that awarded so many companies, having spent R400m on more than 230 companies and you look at other provinces having spent R2.2bn,” she added.
Citing an explanation received from Mudau and head of department Thokozani Mhlongo, Ramathuba said Pro Secure was appointed to supply 900 000 litres of sanitisers because it was a manufacturer.
“The department of health ordered 900 000 litres in batches mainly because (the) education (department) put us under pressure. But I also asked why this one company is getting all these, and also coming from Durban.
“I don’t know who are the owners but I was told they are the manufacturers, and at the time we did not have people who were doing the sanitisers that met the specifications,” Ramathuba maintained.
Sources said Pro Secure allegedly subcontracted a company linked to Polokwane Hospital chief executive Pandelani “PJ” Ramawa, who is close to Ramathuba and Mudau.
“A lot of people were hired by PJ to assemble masks at his house in Flora Park, and you could see the quantity is massive. I asked one guy in passing, and he said they were packing one million PPE. Then rumours started doing the rounds that PJ fronted his younger sister and some Indian guy for PPE,” said a Polokwane businessman.
Ramawa, who is also the director Var Holdings (Pty) Ltd, denied that Pro Secure subcontracted a company owned by his younger sister to supply PPE, adding “not to my knowledge”.
Ramawa said he had no relationship with Govender, he had “never met him” and “don’t even know him”.
Govender could not be reached for comment.
Simango denied helping Mudau manipulate procurement processes, saying “I don’t know those things”.
Mudau referred all enquiries to Limpopo Department of Health spokesperson, Neil Shikwambana, who denied that the PPE procurement process was marred by fraud, irregularities and nepotism. He said contracts worth R625m had been awarded by the end of July.
“The department’s PPE procurement was fair, equitable, transparent, competitive and cost effective and compliant to prevailing legislative frameworks for procurement of Covid-19/PPE requirements,” he said.
Shikwambana confirmed that Pro Secure was not on the Limpopo PPE database, saying the department “came to know about Pro Secure and its services through market and commodity research”.
“The company had the commodity with the right ingredients at the time, which was also severely affected by the pandemic and as such became scarce in the country. Furthermore, the company complied with the specification and scored the highest number of points in terms of the Preferential Procurement Policy Framework Regulation of 2017.”
He said the department was “not aware” of any relationship between Govender, Mudau and Ramawa.
“Furthermore, the department verified with the CFO: Mr Mudau and Pietersburg Hospital CEO: Mr PJ Ramawa if they have a relationship with Pro Secure CEO Ferrel Govender and they both denied that they have a relationship with Govender,” said Shikwambana.
He confirmed that Moloi’s daughter had been awarded a contract but insisted her relationship with Ramathuba does not pose a conflict of interest because “the declaration is in relation to family and friends who are involved in the procurement processes”.
Shikwambana said all the beneficiaries were sourced from the central supplier database because the PPE database only came into being in June.
On why most beneficiaries came from Ramathuba’s home region of Vhembe, Shikwambana said “it is not part of the requirement to declare your region of origin when bidding for contracts in government”.
Three Limpopo business people whose companies supply medical equipment said they had been excluded from PPE contracts in favour of companies which were not even registered with the South African Health Product Regulatory Authority, whose mandate is to protect patients.
“They said they were going to help (with PPE) small businesses at least to participate in order to encourage especially women-owned businesses to grow. But none of these things happened. Politicians came and the opportunities were taken,” said a Polokwane businesswoman.