National Health Department officials have found that aside from the Western Cape, provincial hospital suppliers had been marking up by as much as 48% linen centrally sourced from the Labour Department‘s facility for disabled people. Fin24 reports that this is according to Health Minister Aaron Motsoaledi who was commenting on Finance Minister Tito Mboweni saying during the recent mini budget that R350m would be reprioritised to recruit over 2,000 healthcare professionals, and R150m would be used to purchase beds and linens for hospitals in dire need.
The report quotes Treasury director general Dondo Mogajane as saying that the department would be sourcing the linen from a producer that employs disabled people in partnership with the Labour Department.
According to Motsoaledi, the department had in June sent out 200 officials to hospitals where the linen shortage was discovered. “We agreed to buy linen centrally (at national government level) and then send it to provinces,” he said. “(But) we discovered something that broke my heart.”
Motsoaledi said only the Western Cape province bought its linen from the Labour Department’s facility in Silverton, Gauteng. “We found an order from the Western Cape of R17m. Where were the other provinces?” he asked.
Motsoaledi said the other provinces issued tenders for linen. “The person who gets the tender, gets linen from these disabled people and sells it to the state at (a margin) of 48%,” he explained.
According to Motsoaledi, there were 12 of these factories across the country, generating a gross profit of R220m, of which R120m covered costs and R80m went back to the fiscus. Those employed by the factory eventually were removed from the social grants system, as they could start to earn an income and sustain themselves.
“I do not know why such an important structure should not be supported. That is why we insisted on it,” he is quoted in the report as saying.Fin24 report