The Special Investigating Unit (SIU) has declared decisions by the Gauteng Departments of Health and Infrastructure Development enabling 12 companies to earn R93m from a R500m project to renovate a Gauteng hospital leased by the provincial government during Covid, as illegal.
AngloGold Ashanti was previously owned by the Western Levels Deep Mine Hospital in Carletonville and leased from Golden Core Trade and Invest by Gauteng Health and Infrastructure Development.
The goal was to urgently source additional hospital beds to cope with the rising number of Covid patients – but the facility was initially earmarked for use as a mental institution, reports the Cape Argus.
Refurbishment was estimated to cost around R50m, with another R10m to rejuvenate residential accommodation on the premises, according to the two departments – which, however, ultimately ended up spending more than R500m.
Neither could explain how or why the costs ballooned.
In its probe, the SIU found that no valid procurement processes in terms of internal policies were followed relating to the appointment of the dozen companies to undertake the refurbishment.
“The appointments of these service providers were furthermore dependant on the finalisation of the agreement for acquisition of the hospital. No tender processes were followed,” the SIU found, adding that professional service providers and contractors were telephonically advised of their appointments.
Additionally, many were not on the provincial departments’ panels of approved service providers and no approvals from the Provincial Treasury were obtained for the expenditure.
The SIU also found evidence of overcharging, disgorgement of profits, and invoicing for amounts that are not market-related, by the 12 companies.
The SIU was also able to quantify the amounts by which the government was overcharged by the companies – and established that despite the enormous costs, the work was not completed on time, and the hospital could not be used during the first three waves of the pandemic, rendering the need to urgently secure additional hospital beds superfluous and meaningless.
Last week, Judge Soma Naidoo, a member of the Special Tribunal, declared that the decisions of the provincial Departments of Health and Infrastructure Development to enter into the lease agreement were inconsistent with the Constitution, invalid and/or unlawful and or illegal, and set them aside.
Naidoo also declared the departments’ decisions to appoint the 12 professional service providers and/or contractors to provide services and/or perform works relating to the refurbishment and renovation of the hospital inconsistent with the Constitution and/or unlawful, invalid.
Cape Argus PressReader article – How R50m Covid-19 hospital renovations rose to R500m (Open access)
See more from MedicalBrief archives:
Officials fired for Anglo Ashanti Hospital fraud and corruption
DA: R700m Anglo Ashanti hospital will become ghost hospital
DA: Freeze expenditure and recover R500m unlawfully spent on Anglo Ashanti Hospital