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R500-million Covid-19 Gauteng hospital contract was irregularly awarded — SIU

Last year, the Mail & Guardian reported that the Gauteng health department and infrastructural development department invested in a dilapidated mine hospital in Carletonville. At the time, Covid-19 infection numbers were rising and people were dying and the department said the Anglogold Ashanti Hospital was necessary. 

In January, the M&G reported that the Special Investigating Unit (SIU) was looking into the “waste” of R500-million that was meant to add 175 Covid-19 intensive care beds to Gauteng’s total bed count for the pandemic, because the province was battled with apparent shortages. 

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On 17 September, the SIU was given the green light to freeze the funds of three companies found to have irregularly benefited from the R500-million contract. The Special Tribunal ordered that Pro Service Consulting, Thenga Holdings and First National Bank be prohibited from dealing in any manner with the property and the funds held in the bank accounts and investments pending the review proceedings of the SIU. 

The funds include R1.7-million held in Pro Service Consulting’s FNB account and R6.2-million in the Thenga Holdings account at the same bank.

The SIU has found that the appointments were done irregularly and unlawfully, and should be set aside as invalid. The SIU statement says although the refurbishment of the Anglogold Ashanti Hospital was done to accommodate seriously ill patients infected with Covid-19, neither the Gauteng health department nor the department of infrastructural development fully complied with procurement or competitive bidding processes in the appointment of the contractors. 

“The service rendering commenced even before the relevant appointment and/or 

contracts had been finalised. There was no approved budget for the refurbishments, which increased from an estimated R50-million, to an amount in excess of approximately R500-million, and the processes were subject to many delays, which rendered the hospital unavailable for the first, second and third waves of the Covid-19 pandemic,” the SIU said.

In November last year, the SIU sent a letter to senior officials from Gauteng’s health and infrastructure departments alerting the province to the fact that it was investigating the R500‑million refurbishment project of the hospital.

The letter, which was signed by the SIU head advocate Andy Mothibi, lists five “grave risks” to the Gauteng health and infrastructure departments, as a result of work stoppages caused, among other reasons, by strike action on site. 

The letter was addressed to Richard Makhumisani, the acting head of the infrastructure development department, Arnold Malotana, the interim head of department for the provincial health portfolio, and Carel van Heerden, the legal services head for the Gauteng health department. 

“Payments to the eight contractors working on-site were stopped, pending the outcome of the SIU investigation, which has caused severe unhappiness with the relevant contractors. Certain contractors [are] threatening to take the law into their own hands by stripping [or] breaking down and removing the equipment (including very expensive medical equipment) from the site, because they have not been paid for their work,” Mothibi’s letter reads.   

The R500-million figure was revealed at a site visit in May last year by infrastructure development member of the executive council, Tasneem Motara, who said the hospital had been expected to be handed over to the health department the following month.

The hospital was leased to the provincial government by mining company Harmony Gold, which had acquired Anglogold Ashanti’s assets. 

In response to questions in January, Gauteng health spokesperson Kwara Kekana said the hospital would be able to assist with the surge in cases the province was experiencing. This did not happen. 

“The infrastructure in the hospital had to be repurposed for a new critical care facility. The department intends to use the hospital beyond the Covid period as it will add much-needed beds in the province,” Kekana said at the time.

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Athandiwe Saba
Athandiwe Saba

Athandiwe Saba is a multi award-winning journalist who is passionate about data, human interest issues, governance and everything that isn’t on social media. She is an author, an avid reader and trying to find the answer to the perfect balance between investigative journalism, online audiences and the decline in newspaper sales. It’s a rough world and a rewarding profession.

Khaya Koko
Khaya Koko is a journalist with a penchant for reading through legal documents braving the ravages of cold court benches to expose the crooked. He writes about social justice and human-interest stories. Most importantly, he is a card-carrying member of the Mighty Orlando Pirates.

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