Ramaphosa scrambles to staunch anger over medical relief corruption

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President Cyril Ramaphosa's administration is scrambling to deal with a wave of national outrage over evidence of billions of rands of corruption and looting of COVID-19 emergency medical relief funds, writes MedicalBrief. With continuing revelations of high-level corruption, the government has so far failed to placate the anger of an array of professional and civil society organisations, including of liberation-era veterans.

As MedicalBrief reported last week, moore than R2.2bn of emergency COVID-19 funds have been stolen in the corruption feeding frenzy, the news breaking just as the International Monetary Fund has agreed to a further R70bn relief loan. Ramaphosa has signed a proclamation for the Special Investigating Unit to investigate, as is the SA Human Rights Commission and the Public Protector's Office.

Following the embarrassment of Ramaphosa's personal spokesperson taking "voluntary leave of absence" because of her husband's company being implicated in the scandal, it has been announced that Gauteng Health MEC Bandile Musuku will also take "leave of absence", while the Scorpio investigative journalism unit has revealed that two companies owned by the sons of former Free State Premier and current ANC secretary-general, Ace Magashule, have clinched COVID-19 contracts with a combined value of R2.7m.

The South African Medical Association (Sama) has issued statement saying that the alleged corruption in the provision of medical supplies is deeply unsettling and poses a threat to the provision of proper medical care to patients. Improprieties in medical tenders damaged not only the country's economy and reputation, but also its ability to care for the sick. "As a professional body representing doctors, we take a strong stand against these purported abuses," said Sama chair, Dr Angelique Coetzee.

She says Sama concurs with President Cyril Ramaphosa that “more so than at any other time, corruption puts lives at risk” but that this sentiment remains hollow without meaningful, transparent, and visible action, particularly from the highest office in the country.

“As doctors we are on the frontline of fighting coronavirus every day – putting our own and our family’s lives at risk every time we report for work to assist the sick. When medical equipment such as personal protective equipment (PPE) is the focus of an alleged wrongdoing we expect immediate and urgent action. Unless it is done, and seen to be done, irregularities will continue, and continue to burden an already over-stretched health sector,” she says.

Coetzee notes that the latest reports follow a string of similar incidents including the disastrous medical scooter debacle in the Eastern Cape, lack of proper equipment in state hospitals across the country, and companies being established specifically to do business with health departments to secure relief funding, even though they lack proper experience in the sector.

“The list goes on and on. There is clearly no accountability in government nor, apparently, a political will to deal with corruption. If there was, we believe, the strong message would have been supported by equally strong action which we don’t see. There are many occasions were corruption is evident yet no action is taken and we are stunned by the seemingly non-interventionist approaches to these incidents,” says Dr Coetzee.

Of particular concern to Sama, apart from the allegations of abuse, is the continued poor state of healthcare in the country which is not improving, and which is in desperate need of significant funding to correct. “The billions of rands which have allegedly been siphoned off of legitimate channels has the effect that doctors and other healthcare workers are treating patients without the proper PPE, are having to work without proper equipment to diagnose patients, and the patients themselves have to suffer more in the often pitiful wards of dysfunctional hospitals. We can simply not continue like this, something has to give,” notes Coetzee.

Coetzee says in response Sama is again urging all healthcare workers and administrators who have evidence of wrongdoing to come forward and report abuse. She says it’s also critical that where equipment is lacking it is brought to the attention of those in charge.

“We have to begin taking stock in every hospital and every clinic in our country. If there are violations of procedures, and healthcare workers are struggling without the necessary equipment or medicines, we urge them to report these; without this critical on-the-ground information our situation may never improve,” concludes Coetzee.

 

Some of South Africa's foremost civil society organisations have expressed their anger and disappointment. Polity reports that in a joint statement, the Ahmed Kathrada Foundation, Corruption Watch, Freedom Under Law, Johannesburg Against Injustice, Organisation Undoing Tax Abuse, Patriotic Movement, the South African Communist Party in Gauteng, and Section27 said it was troubling that in Gauteng alone, some 91 companies who received purchase orders from the Health Department were under investigation.

"We commend the Gauteng provincial government's decision to give priority to a Special Investigating Unit (SIU) probe into personal protective equipment (PPE) procurement processes. We also welcome (Thursday's) statements by (Gauteng) Premier David Makhura indicating that Health MEC Bandile Masuku has been placed on leave pending investigation, in light of media allegations involving Royal Bhaca and an alleged PPE contract," the joint statement, issued by the Ahmed Kathrada Foundation, read.

The statement said "covidpreneurship" was occurring at the same time that millions of South Africans were facing job losses and increased poverty.

"There are harrowing stories daily of malnutrition; of retrenchments, business closures and of communities being unable to access healthcare and other services. Our country has had to borrow money from the International Monetary Fund (IMF) to deal with the crisis. Yet, for the ruthless 'covidpreneur', and those within state and other institutions who enable corruption, this is simply an opportunity to exploit the situation. These are people who are unashamed about stealing money meant for protective gear for nurses and doctors, for food parcels for the poor, for workers who find themselves unemployed, for hospitals which require beds and ventilators, for schools that need to ensure that pupils still learn, and for communities in desperate need of services. COVID-19 corruption makes us sick!"

The organisations want the Gauteng government to: ensure that the Health Department cooperates fully with the SIU investigation; extend full cooperation to investigating and prosecuting authorities to secure return of monies paid in corrupt procurement deals; ensure disciplinary processes against public representatives and officials involved in issuing or influencing irregular contracts; press criminal charges against public servants and representatives, as well as businesses that are found to have violated procurement procedures and benefitted unduly from the process. The way must be cleared for the law to take its course, and for those guilty of looting public money to face jail sentences; make all COVID-19 procurement details publicly available in the interest of transparency and accountability. This information should include details of quotations sourced, companies who receive contracts, and the unit cost of the items or services they will be providing. For infrastructure projects, the time-frames for delivery should be included; introduce better procurement monitoring systems to oversee awarding of contracts during COVID-19; disqualify from getting contracts those companies who have no track record of work in a particular area, or those that are merely playing the role of 'middle man'; place companies involved in COVID-19 corruption on a specific database and prevent them from conducting business with the state in future; set up a COVID-19 provincial hotline in the Premier's office to complement the South African Council of Churchs' 'Unburdening Panel' process that has now been reopened. Honest public servants and members of the public should be able to easily report any COVID-19 related corruption, which can be immediately escalated to law enforcement agencies; prohibit members of an executive committee of any political party and their immediate families from doing business with the state. This will weed out all those who are in politics based on self-interest; champion policy that prohibits all public employees and elected officials from doing business with the state; and introduce lifestyle audits for public representatives and officials during this period to monitor any signs of personal financial gain.

"We urge the Gauteng provincial government to give serious consideration to these recommendations and set the tone that corruption will not be tolerated," the organisations added. "We also enjoin other provinces to adopt measures such as these to prevent and tackle COVID-19 corruption within their administrations. Similar recommendations were made by civil society organisations early on in the pandemic to the Presidency to prevent the very situation that we now find ourselves in.

"We strongly believe that action must follow Ramaphosa's commitments to crack down on COVID-19 corruption for the public to be convinced that government is indeed intent on tackling the problem."

 

Also, a group of liberation activists from the late 1960s and 1970s are threatening court action if the bleeding of COVID-19 funds to stop. According to a Moneyweb report they have sent a legal notice to Ramaphosa calling for all work and payments on all COVID-19 tenders suspected of irregularities to be suspended pending an independent review by an external team of experts.

The letter sent by lawyers representing the ‘70s Group is also addressed to Health Minister Zweli Mkhize, Co-operative Governance & Traditional Affairs Minister Nkosazana Dlamini-Zuma, Finance Minister Tito Mboweni and Social Development Minister Lindiwe Zulu.

The report says it comes as the Competition Commission clamps down on issues of unfair pricing on COVID-19 supplies and complaints regarding councillors stealing food parcels intended for the poor. The spotlight has recently moved to instances of lucrative COVID-19-related tenders being awarded to relatives and friends of senior government officials and a number of irregular tenders being investigated by the SIU.

The ‘70s Group also wants other tenders to be placed on hold until they are reviewed by the “irreproachable group” of independent experts to determine the quality of goods and services of the service providers, notes the Moneyweb report.

Further, payments by national and provincial governments related to these tenders should be frozen pending a review of the invoices to identify instances of overpricing and whether the tenders were awarded through proper processes, the group demands.

“The State Attorney is required to give an undertaking within seven days that the payments for the service providers are on hold pending the investigations and finalisation of the review of the tenders so awarded,” the lawyers say.

Should this not happen the group of liberation activists says it will have “no option but to proceed to court on an urgent basis to give effect to the reasonable requests we have so far suggested”. “It’s like the bleeding continues and there is no urgent response to stop the bleeding,” said '70s Group co-ordinator Oupa Ngwenya. Professor Saths Cooper, the group’s treasurer, said they are awaiting the government’s response.

 

Gauteng Health MEC Bandile Masuku, his wife Loyiso Masuku, City of Johannesburg shared services MMC, and Cyril Ramaphosa's spokesperson Khusela Diko have been asked by the provincial ANC to take a leave of absence following the R124m personal protection equipment tender awarded to Diko's husband King Madzikane II Diko's Royal Bacha projects.

News24 reports that the party's provincial secretary Jacob Khawe said the provincial executive committee (PEC) had resolved that the trio must take a leave of absence while the ANC's integrity commission investigated claims that had been made against them in the media. Diko, on Monday, took leave from all her government roles.

Khawe said: “We as the ANC, whether we like it or not, the objective reality is that we are losing trust among our people on our ability, capability and commitment to deal with corruption.”

The integrity committee had been given two to four weeks to complete its report into the claims. The provincial secretary said the MMC would also be expected to subject herself to the provincial integrity committee. Khawe also said the ANC wanted the Gauteng government to answer numerous questions regarding how the tender was procured.

 

Gauteng Transport MEC Jacob Mamabolo has been appointed acting Health MEC by Premier David Makhura, Polity reports. The premier made the announcement during the provincial command council's media briefing.

 

A visibly angry premier David Makhura said the scandal over the supply of PPE has undermined efforts by South Africa’s economic powerhouse in the fight against the pandemic, which has wrecked the economy. Business Day reports that Masuku is the second health MEC the premier has had to take action against in the wake of mass public pressure relating to problems in the department.

Former MEC Qedani Mahlangu resigned on the eve of the release of a report in February 2017 following a judicial commission of inquiry into the deaths of more than 140 psychiatric patients after the provincial government moved them from a specialised Life Healthcare Esidimeni facility to unregistered organisations in a cost-saving exercise.

The report says the probe into the tenders awarded to companies to provide PPE is a massive blow to Makhura’s anticorruption focus in the province, which has included an open tender system that has been running over the past five years.

 

The ANC in Gauteng says it asked its provincial leadership to give an account to the province's residents of how COVID-19 tenders were procured. Polity reports that the party held a media briefing following a special provincial executive committee to discuss the R125m personal protective equipment tender awarded by Gauteng Health to the Amabhaca King Madzikane Diko. The king scored the tender from the department headed by Masuku who is a family friend.

The two, along with the MEC's wife Loyiso Masuku, who is an MMC in the City of Johannesburg are set to face the party's provincial integrity commission over the claims, with the Masukus placed on leave for the next four weeks.

The report says it was also revealed the king and the MMC are business partners, in a venture, which they took control of in 2019, just after the general elections.

The ANC's provincial secretary Jacob Khawe said a report by Makhura showed normal processes were not followed, which usually saw companies applying for the contracts. "We understand it was a special arrangement. It's like an official in the department would call companies, who would say they can provide, have a discussion with these companies and award a letter to these companies," explained Khawe.

He said this also demonstrated how government was open to manipulation. Khawe said the PEC had tasked Makhura with explaining to Gauteng residents how this was allowed to happen, including how procurement processes unfolded and on some of the allegations which had followed.

"The verification of whether indeed there was a tender bonanza; was it like kwa gogo (at Granny's house) where everyone came and took a little bit?" asked Khawe, as he flagged some of the issues the provincial government needed to provide clarity on.

The provincial secretary said while the ANC understood it had no role in telling the specialised investigative unit how to approach investigations, it urged Makhura to "impress" upon it the need for haste in conducting the investigation into tender corruption claims involving the procurement of PPE during the COVID-19 pandemic.

Meanwhile the king has described the PEC's decision to take his wife and the Masukus to the integrity commission as "unfortunate" and "irrational". He said the president's spokesperson, the MEC and the MMC had done nothing wrong, describing them as people who had nothing to do with his business. The king insisted he had provided the necessary PPE to the department and wasn't paid for it.

Diko also stuck to an argument he and his wife made earlier: that he tried to pull out of the contracts after she had told him about the "perceived conflict of interest" accusation that would follow. "I didn't consult with my wife before bidding for the contract, but after I got the contract and she was uncomfortable, but I went ahead," said Diko.

When asked if his company Royal Bacha was suited for the tender, the king asked: "Which company had experience with COVID?" – saying his party had a track record in supply and delivery.

 

Siviwe Gwarube MP, Democratic Alliance (DA) Shadow Minister of Health said in a statement on the Polity site: 

Gauteng Premier David Makhura's announcement that the MEC for Health in Gauteng, Bandile Masuku, will be taking leave of absence following damning allegations of tender irregularities and corruption in his department will not deter rampant corruption which has taken root not only in the Gauteng Provincial Government but across the country.

That is why I have written to President Cyril Ramaphosa calling for the inclusion of all contracts, in his Special Investigative Unit (SIU) proclamation, that were awarded in Gauteng in relation to the COVID-19 response.

I have also called on the Minister of Health, Dr Zweli Mkhize, to immediately make public the names of companies that have been awarded contracts; their board of directors; value of each contract; the service being provided and the status of these contracts.

This week, the Western Cape government has taken the lead in this regard. It has published this information online in order for these contracts to be publicly scrutinised. The 8 other provinces should follow this example.

This information pertains to the use of public money, it should therefore be easily accessed by the public. South Africa is in the middle of a global health crisis. Daily, people are losing their lives and the number of cases are increasing exponentially, all the while the ANC presides over a government that allows for the looting and plundering of public money which is meant to provide equipment that will aid the fight against this pandemic. Healthcare workers are forced to treat patients without protective gear or forced to endanger their lives by recycling PPE because politicians would much rather line their pockets than deliver services to the people of South Africa.

Placing implicated individuals on “leave of absence” does not prevent corruption from taking place because there is not political will to root out this abhorrent culture. If the President is serious about fighting corruption, he needs to empower the SIU to review and investigate all contracts across the country. Those responsible must be removed from government and arrested.

 

The Public Protector’s office has been inundated with complaints relating to the COVID-19 pandemic and South Africa’s response to it, reports Business Day. The report says while the government’s response to curb the spread of the pandemic was initially lauded, the focus has shifted to the allegations of corruption and the failure of those systems that form part of the country’s response to the disease.

In a statement released by her office, Busisiwe Mkhwebane said there has been a “rapid surge” in the number of complaints it has received over the past four months about conduct and service delivery failures relating to the pandemic. A steering committee consisting of 10 senior investigators has now been set up to focus on COVID-19-related matters, the office said.

 

The South African Human Rights Commission (SAHRC) intends to launch its own investigation into the claims, reports Polity. The commission's Gauteng manager, Buang Jones, said the Chapter 9 institution would be launching a probe into government from when it started its COVID-19 response.

"… We will be looking at alleged procurement irregularities through the human rights lens. We will also be looking at the impact of public procurement and alleged irregularities on the right to health. The SAHRC has a broad mandate, nothing precludes the commission from embarking on this investigation," Jones said. He added that the commission would borrow expertise from the forensic and legal sectors to understand what happened to money government spent in response to COVID-19.

Jones said the integrity of the Gauteng Health Department was currently in question, with corruption impacting directly on human rights. Jones called on employees in the department and civil society to come forward to the commission with any information they may have to assist in the investigation. "We hope that through this investigation we will be able to unearth information that will assist us in arriving at solutions."

 

Khusela Diko said she “regretted” her husband’s company seeking to do business with Gauteng Health. In a joint statement with her husband, she admitted that there was public anger over reports that Madzikane’s company Royal Bhaca Projects was awarded R125m in tenders for PPE, notes TimesLIVE.

“Over the last week, as individuals, a couple and a family, we have found ourselves at the centre of a media and public storm over a Gauteng Health Department PPE supply contract that was awarded to Royal Bhaca Projects and subsequently cancelled,” she said. “Despite the absence of any illegality and confirmation that no public funds were ever paid to Royal Bhaca Projects – details of which will be further ventilated by the investigations – the matter continues to draw outrage from across society.”

Diko said she understood that allegations of state capture were playing into the anger – though she had voluntarily stepped down as Ramaphosa’s spokesperson pending an investigation into the claims. She said she regretted that the company even applied for the tender in the first place.

“Although there was no corruption in the bidding and subsequent awarding of the PPE contract to Royal Bhaca Projects, we accept that years of cronyism have created an environment of mistrust and suspicion when individuals who are close to political office and influence are seen to be benefiting from the state in ways that may be unethical. We have attempted to rectify this matter by seeking to cancel the contract, and we deeply regret the error of judgment that led Royal Bhaca to seek to do business with this department in the first place.”

 

Ramaphosa's son Andile is also in the media spotlight. According to a TimesLIVE report, he said his company will save lives after it received R6m in funding to modify thousands of Gauteng taxis. The modifications would allow the vehicles to comply with COVID-19 regulations.

The non-profit company SDI Force is fitting screens that will create a “driver-separation” capsule, window ventilators, sanitiser dispensers and changeable messaging boards in taxis. All these are aimed at preventing the spread of the coronavirus inside taxis.
“Despite a few negative comments, SDI has had an overwhelmingly positive reception from media and businesses at large,” said Andile.

However, AfriForum has called on the Public Protector to check whether everything was above board with the non-profit company being given the multimillion-rand contract. It wanted to establish whether Andile's family ties had anything to do with SDI Force getting the deal.

“Due to recent revelations of government corruption and looting of COVID-19 relief funds, it is in the public’s interest to establish whether Andile Ramaphosa received government support for this project and if this amounts to corruption,” said Monique Taute, head of the organisation’s anti-corruption unit.

“If him being the son of the President played any role in SDI receiving government funding, it may amount to corruption and must therefore be investigated.”

 

A Scorpio investigation has revealed that two companies owned by the sons of former Free State Premier and current ANC secretary-general, Ace Magashule, have clinched COVID-19 contracts with a combined value of R2.7m. Pieter-Louis Myburgh, in a report on the Daily Maverick site, notes that the Free State’s latest tender bulletin, published on 17 July, lists the names of around 70 businesses that received contracts for COVID-19-related goods and services, with a combined value of R173m.

The list includes the names of Motheko Projects and Marvel Deeds. Tshepiso Magashule, the ANC SG’s eldest son, is Motheko Project’s sole director, company records reveal. Tshepiso’s younger brother, Thato, is listed as the sole director of Marvel Deeds. According to the tender bulletin, Motheko Projects received a contract worth R2.29m from the provincial Treasury. Marvel Deeds’ contract is valued at R427,221. Myburgh says it is not clear what goods or services the Magashule brothers’ companies were contracted to deliver, but the tender bulletin confirms that these deals relate to government authorities’ ongoing fight against the COVID-19 pandemic.

“I have done nothing wrong. Please check with the Free State provincial treasury,” Tshepiso Magashule reportedly told Scorpio. He did not respond to queries regarding the type of goods or services his company was contracted to deliver in the Free State. Thato Magashule reportedly did not respond to queries.

Ace Magashule reportedly told Scorpio that he was not aware that his sons’ companies had bid for, or won, the contracts. He also strongly denied that he had influenced the procurement process. “I have got nothing to do with Free State government matters or tenders. I am out of that space,” said the ANC official. Two sources familiar with the Free State’s political environment reportedly allege that Magashule and the provincial Treasury’s MEC, Gadija Brown, are close.

“That relationship has not changed since Magashule left the province,” one source is quoted as saying. Magashule also strongly denied this. “I am not close to anybody. I work with the leadership of the ANC and members of government, but I have no special relationship with anyone,” said Magashule.

The provincial Treasury’s spokesperson, Tshidiso Mokokoane, maintained that there would be nothing wrong with Magashule’s sons securing such contracts. “Even if they are the sons of the former Premier in the province, it doesn’t mean that they must not participate in the mainstream economy of the province,” said Mokokoane.

In a written response to Scorpio, the provincial Treasury rejected insinuations that MEC Brown and Magashule had a close relationship.

 

And in the Diko matter that has been in the news for two weeks, it has come to light that the Gauteng Health Department has paid Royal Bhaca Projects at least R80m for its PPE services over the past week alone through a front company known as Ledla Structural Development. This is revealed in a report in The Sunday Independent, which says the money was channelled through Ledla in 12 tranches of between R120 000 and R38m after the company invoiced for items that bear a striking resemblance in value, quantity and pricing to the ones supplied by Royal Bhaca, according to payment records, official documents and sources.

The report says it is not clear whether the R80m payment was the balance or a portion of the R125m contract controversially awarded to King Madzikane ll Thandisizwe Diko in March. Ledla, based at Boksburg, received the payments between 20 and 27 July, even though it did not appear on the original list of 75 successful bidders who benefited from R2.2bn worth of PPE contracts in Gauteng. An independent company search indicated that Ledla is a family-owned business.

Previously, Madzikane claimed he “walked away from the deal” after supplying PPE out of concern of a conflict of interest involving his wife, who is a Gauteng ANC provincial executive committee member. However, neither he nor Gauteng Health MEC Bandile Masuku, who also claimed the contract was cancelled, produced a cancellation letter. Instead, Madzikane claimed he did not take legal action to recoup his money because he was willing to “assist” the government where possible.

Madzikane said: “I believe that the Special Investigations Unit is currently investigating matters relating to COVID-19 procurement. Please may we respect that process and trust it to get to uncover the truth around this matter.”

 

The report in the Sunday Independent highlights the complete lack of controls that allowed this to happen, writes Jack Bloom, Democratic Alliance Gauteng Shadow Health MEC in a report on the Politicsweb site. Bloom writes: “I am concerned that some of this money was paid as late as last week, and more might still be paid. This contradicts the assertion by Premier David Makhura that payments have been stopped to disputed PPE contracts.

“We need to know why payments are still being paid to fishy companies and why the department does not deal directly with medical supply companies which would be simpler and cheaper.

“Premier Makhura has claimed for years now that the Gauteng Health Department was being ‘turned around’ but the rot is still there.

“The accountability for this PPE scandal is far wider than just Health MEC Bandile Masuku who has now been suspended for four weeks while investigations continue.

“More heads need to roll and criminal prosecutions should follow for all who are implicated in this greedy grab for contracts that has resulted in inferior and inadequate protective equipment for health workers fighting the COVID-19 pandemic.”

 

Sama material

 

Full Polity report

 

Full Moneyweb report

 

Full News24 report

 

Full Polity report

 

Full Business Day report

 

Full Polity report

 

Full statement on the Polity site

 

Full Business Day report

 

Full Polity report

 

Full TimesLIVE report

 

Full TimesLIVE report

 

Full Moneyweb report

 

Full Scorpio report on the Daily Maverick site

 

Full report in The Sunday Independent

 

Full report on the Politicsweb site

 

 

See also
Corruption feeding frenzy involving R2.2bn of pandemic relief funds


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