Strategies that include a tip-off hotline are helping the beleaguered National Health Laboratory Service reduce fraud and criminality – after the organisation was rocked by a scandal several years ago involving contracts worth about R200m, which implicated its former chief executive and chief financial officer, reports Daily Maverick.
As part of a written answer to a question in Parliament, Health Minister Aaron Motsoaledi has published data and information showing that the NHLS has been tackling crime and corruption – and that acting on public tip-offs is paying dividends.
The NHLS is the primary provider of diagnostic pathology services to the public health sector, and in addition, its forensic chemistry laboratories handle the tests for blood alcohol analysis as well as toxicology tests to determine causes of death.
In 2019, after the corruption scandal linked to information technology (IT) contracts worth about R200m at the service, it introduced the Vuvuzela tip-off hotline to receive information on where things are going wrong.
Independently managed by the Audit and Risk Department of the NHLS, it ensures the impartial handling of reported concerns, and since inception, has received 175 tip-offs.
Motsoaledi said 75 of them were not related to fraud or any crime, and were sent to the NHLS management for resolution as they mostly dealt with customer debt enquiries, complaints regarding non-compliance with Covid restrictions and requests submitted under the Promotion of Access to Information Act.
Of the remaining complaints, 24 were substantiated and actions were taken against those responsible. Another 14 investigations are still continuing.
Cleaning up
Since her appointment as CEO of the NHLS in 2024, Professor Koleka Mlisana has had to battle an extensive cyber-attack that took out the service’s systems, as well as R9.2bn in bad debt racked up by provinces not paying for their medical tests.
In the early days of the hotline, until 2021, the substantiated tip-offs related mostly to scammers fraudulently using doctors’ practice numbers, as well as irregular procurement processes. In the latter instance, several employees were subsequently dismissed or resigned.
There were also tip-offs on theft and abuse of NHLS assets as well as nepotism. They have also been followed up and resulted in disciplinary action and dismissals.
In the past year, a tip-off resulted in an investigation into an employee who was selling fake NHLS test results. In some past cases, this was done to obtain a disability grant from the SA Social Security Agency, however, the employee subsequently died while the investigation was taking place.
Two sets of tip-offs were received about procurement processes, and both were being investigated. In another case, an employee was found to have faked their qualifications. This case, too, was substantiated, but the employee resigned before steps could be taken, Motsoaledi said.
The most recent tip-offs included a service provider’s attempt to bribe an employee for a tender award. It was reported to management, who informed the police.
Past mistakes
In September 2024, former NHLS CEO Joyce Mogale and the late former CFO, Sikhumbuzo Zulu, lost their case in the Labour Court against their dismissal for fraud and corruption in 2019. Zulu died before the court proceedings were concluded.
Mogale was ordered to pay the public entity about R22m for losses related to one of three questionable contracts. The board of the NHLS described the ruling as a “victory for governance”.
The NHLS had become aware of irregularities in three contracts worth about R200m in February 2017. Mogale and Zulu were suspended and subsequently dismissed after a disciplinary hearing. The Vuvuzela hotline was introduced shortly after that.
During their disciplinary hearing, Advocate Nazeer Cassim SC said Mogale and Zulu had displayed conduct “symptomatic of the grand-scale looting and thievery in our country”.
In 2024, Mogale was charged with fraud and contravention of the Public Finance Management Act over an IT contract with a company called Blue Future. She was released on R20 000 bail.
Her co-accused are the former head of NHLS supply chain management, Graham Motsepe, former manager of contracts and tender compliance Mthunzi Mthimkulu, former legal manager Sibusiso Mthenjane and the owner of Blue Future, Pierre Petersen.
Health Departments owe billions
One of the biggest risks to the financial stability of the NHLS is failure by provincial Health Departments to pay their bills, which collectively owe the service R9.7bn.
The two biggest debtors are Gauteng Health, owing R1.9bn, and the Eastern Cape Department of Health, owing R1.3bn. The Free State’s debt has escalated to R523m, the Northern Cape owes R475m and North West owes R402m.
NHLS chief financial officer Pumeza Mayekiso said KwaZulu-Natal had no current debt, but had a historic debt of R2.5bn it was paying off. She said discussions had begun with the Eastern Cape and Gauteng.
Mayekiso added that there was a payment plan in place for Gauteng, but the province had been having trouble making payments since the Covid-19 pandemic.
Limpopo and the Western Cape’s debts to the NHLS were up to date. Mpumalanga had no historic debt, but its current debt stood at R59m. Mayekiso hoped to open discussions with Free State Health soon.
See more from MedicalBrief archives:
Labour Court orders ex-NHLS boss to repay R22m
NHLS managers resign but still face legal action
Ramaphosa orders corruption probe into National Health Laboratory Services