Corrupt expenditure and fraud totalling R1.2-billion was uncovered within the Gauteng Health Department by the Special Investigating Unit (SIU)‚ according to a report made public on Thursday.
The report details how the department was “captured” by senior officials and private companies in 2008 and 2009.
NGO Section 27 accessed the report through a Promotion of Access to Information request. The final report was given to former president Jacob Zuma in 2017 by the SIU‚ but only released to the NGO last month by President Cyril Ramaphosa’s administration.
The report shows how senior officials in the Gauteng Department of Health and a former MEC were investigated for defrauding the department.
The Gauteng Health Department is currently in debt of more than R6-billion‚ it emerged during the Esidimeni hearings. The SIU report explains how some money went missing.
The alleged culprits are named in the report‚ but their identities are withheld in this article for legal reasons.
Central to this “capture” by top provincial leaders was a company that was allegedly irregularly hired to work out how to best spend the Gauteng health budget from 2008 and 2009. The SIU report found they didn’t actually do the work determining how to allocate the budget; the Gauteng department officials did.
The company made money by charging the Department of Health inflated prices for goods. One instance involved a contract to host a Department of Health conference. A proper tender process found a company could administer the conference for R300‚000. Instead the contract was given to a consulting firm‚ which sub-contracted it to an events company and charged R1.6-million.
It double-billed for work done and billed for work that was not completed or not done for the Department of Health‚ according to the investigation.
The company also flew a politician to Dubai twice‚ to Vienna‚ London‚ Mauritius‚ Lusaka‚ Cape Town and Durban.
According to the report‚ the SIU investigation also discovered that the company:
• Awarded contracts to friends and family of its directors‚ and companies in which it held an interest;
• Awarded contracts for a wide range of services unrelated to the department’s strategic objectives
• Appointed companies on retainers to the consultancy firm on behalf of the department without having the authority to do so;
• Inflated prices unreasonably compared to prices given by previous service providers to the department;
• Claimed payment from the department prior to the approval of the relevant projects by the department;
• Assisted companies to start businesses at the cost of the department; and
• Received generous kickbacks from sub-contractors it contracted with‚ often under the guise of fees for advance financing where such financing did not occur.
The consultancy firm went bankrupt when it lost the department work.
The SIU suggested criminal prosecutions against those involved in the alleged corruption and irregular expenditure.
Katharine Child – TimesLIVE