Digital Vibes R150 million irregular contract fuels calls for Zweli Mkhize’s sacking

Pressure is mounting on President Cyril Ramaphosa to act against Health Minister Zweli Mkhize following his latest controversial admission that the awarding of a R150 million tender to Digital Vibes was irregular.

Mkhize made the admission on Wednesday following the outcome of an internal investigation into the tender awarded to his former private assistant, Tahera Mathera, and former spokesperson, Naardhira Mitha. Digital Vibes was awarded a R150 million contract for communications work. The deal had initially focused on the National Health Insurance but was expanded last year to include Covid-19 communication work.

Mkhize’s latest admission contradicts a parliamentary reply he gave to the DA’s former health spokesperson, Lindy Wilson, in November last year. Wilson had asked Mkhize to give her details about the contract awarded to Digital Vibes and whether they had entered into a service level agreement after proper tender processes.

Wilson asked the questions after it emerged in the department’s 2019/2020 financial year report, stating that the R18 million worth of registered irregular expenditure was for the NHI supplier (Digital Vibes). In his reply, Mkhize said the appointment happened on November 15, 2019 through a deviation process to provide communication services in relation to the NHI Bill as released by the Cabinet for Parliament’s consideration.

He added that a closed tender process was approved and supported by National Treasury. On March 25 last year, the department extended the scope of work of Digital Vibes to include Covid-19. “This deviation was supported by National Treasury on a letter dated 24 June, 2020 in terms of emergency procurement,” Mkhize said. According to Mkhize, the transaction in question was not irregular as there was a contract already in place.

Mkhize also said the Digital Vibes contract was supposed to come to an end on November 30, 2020, however due to logistical arrangements, the contract was extended on a month-to-month basis. He further maintained that the Department of Health had entered into a Service Level Agreement with Digital Vibes through a deviation process to provide communication services in relation to the NHI Bill.

On Wednesday, however, Mkhize said the appointment of Digital Vibes was irregular, saying his department had grown concerned over the contract and initiated an internal investigation in January. The investigation, conducted by an external tax firm, has been concluded. A summary of its findings included that “the tender and the bidding process followed were a contravention of the Public Finance Management Act”.

It also found that the process of appointing Digital Vibes was irregular because of inconsistencies in the bidding committee and lack of disclosure over conflict of interest. “The investigators have found that an amount of some R37 million paid to Digital Vibes constitutes fruitless and wasteful expenditure,” Mkhize said. Mkhize reiterated that while the public outrage following the revelations was justified, he would not be stepping aside as he didn’t personally benefit from the contract.

Attempts to obtain comment from ANC’s national office were unsuccessful. The DA has accelerated its call for Ramaphosa to axe Mkhize. DA health spokesperson Siviwe Gwarube said it was now clear that this looting of public money had happened under the leadership of Mkhize, while there was a glaring conflict of interest.

“It cannot be that the very person entrusted with the Covid-19 response in the country is embroiled in this kind of scandal involving public money. Minister Mkhize should step down pending a full Special Investigating Unit (SIU) investigation,” Gwarube said. She said Mkhize could not be both the player and referee in an investigation that involves him directly.

The DA also asked Ramaphosa to expand the scope of the SIU investigation to include the new information which had come to light. “The internal departmental investigation is wholly inadequate and more work needs to be done in order to uncover the true extent of the rot in this scandal,” Gwarube insisted.