Despite public outrage over the R2-billion looting uncovered at Tembisa Hospital, the companies implicated in the corruption scandal are still not blacklisted or banned from doing business with the government.
This information is contained in a written parliamentary reply by health minister Aaron Motsoaledi to a question from ActionSA MP Kgosi Letlape, who asked what immediate action has been taken following the Special Investigating Unit’s (SIU) report that exposed a criminal network that looted R2-billion in public health funds from the hospital.
Slain Babita Deokaran’s red flags regarding the R850-million corruption at Tembisa Hospital prompted these investigations.
At the centre is an alleged syndicate, led by controversial businessman Hangwani Morgan Maumela. His network handled contracts worth more than R816-million through 41 linked suppliers.
Three of the companies are linked to alleged drug cartel member and attempted murder-accused Vusimuzi “Cat” Matlala and were awarded contracts worth more than R13.5-million.
Motsoaledi admitted that no companies have yet been blacklisted, even though the SIU had identified those involved in the looting scheme.
Instead, he said the matter had been handed over to the National Treasury, which has the power to enforce blacklisting.
No mention of contract cancellations
“The NHC [National Health Council] requested the SIU to blacklist all the companies involved in the syndicate.
“The SIU reported that only the National Treasury can blacklist companies and that they have already submitted the names of such companies to the Treasury for their attention.
“In the meantime, the SIU has been asked to submit to provinces a list of such companies so that even if there is no blacklisting yet, the HODs [heads of departments] pay special due diligence and investigations before they finalise awards to such companies if bid adjudication committees have recommended them,” Motsoaledi said.
While Motsoaledi highlighted plans for workshops and meetings among senior health officials to “build firewalls” against future corruption, critics say such discussions do little to punish those already exposed by the SIU.
He also pointed to existing whistleblower channels through the Health Sector Anti-Corruption Forum and hotlines but avoided mentioning disciplinary action or contract cancellations against officials or suppliers linked to the scandal.
“The legislative mandate and policy oversight of the procurement system lie with the National Treasury.
“The report of the SIU and its recommendations will be shared with the Ministry of Finance with a request that the National Treasury assist by reviewing the regulations on procurement.”
Corrupt payments
Letlape insisted that this shows that government permits continued looting in Tembisa Hospital.
Not only did senior officials from Gauteng’s health department and Tembisa Hospital face accusations, but they also discovered that they had received corrupt payments from service providers.
Evidence also showed these officials were involved in money laundering, fronting, and using fake supply chain documents.
The investigation now covers 207 service providers linked to 4 501 purchase orders at the hospital. Several other syndicates have been identified but are not yet named.
“These revelations expose deep structural weaknesses in South Africa’s public procurement system, one that not only allows individuals with no experience, capacity, or track record to secure lucrative tenders but even enables companies implicated in corruption to continue doing business with the state,” Letlape said.
“The Department of Health has admitted that it lacks the authority to blacklist suppliers, which is a responsibility that lies solely with the National Treasury.
“This bureaucratic loophole allows those under investigation to continue trading with other government departments while awaiting Treasury’s action.”
