Tender stymies health dept

A R2.5 billion tender awarded to a finance company has left the KwaZulu-Natal health department reeling because it is unable to purchase more than R300 million-worth of urgently needed equipment. The contract, which took the department seven weeks to finalise in 2015, means that, for five years starting in May 2015 and ending in April 2020, the department cannot obtain any medical equipment worth more than R5 000, other than that which it leases from Resultant Finance. Resultant Finance was awarded the tender ZNB 5709/2015-H and is responsible for leasing all “medical and non-medical equipment”. While there are questions over the tender and the fact that it would leave the department owning none of the equipment in its hospitals and clinics, the bigger problem is that even leased equipment has not been forthcoming. So dire has the situation become that the department earlier this year compiled a list (a copy is in the possession of ANA) of equipment that was urgently needed in hospitals and clinics.

The equipment, which the department believed would cost R311.7 million, ranged from endoscopy machines to ultrasound and x-ray machines, as well as incubators. There were 813 items that were needed at hospitals across the province. A internal memorandum, a copy of which is also in ANA's possession, that was sent by the department's acting GM for Supply Chain Management, Credo Mlaba, in April last year to various senior officials in the department advises that all requests for procurement of medical equipment has to be sent to the department's Health Technology Services (HTS). HTS is supposed to obtain the equipment from Resultant Finance. “No institution is permitted to advertise quotations in the government gazette or notice board for procurement of medical equipment going forward,” the memorandum instructs. In another memorandum, also by Mlaba on the same day, advises the same senior officials that they have approval to acquire equipment and “non-medical assets” up to the value of R5 000, provided that there are funds available in the respective budgets. And since then, there have been no orders for replacement equipment, even when equipment has broken down.

The tender was advertised in the Government Gazette on February 6, 2015. The closing date for submissions for ZNB 5709/2015-H was March 2, 2015. By April 13, 2015, Dr Mdu Gama, the chief executive of Resultant Finance, had already signed off on the deal and, a little more than a week later, Dr Millicent Lindiwe Beryl Simelane signed off on the R2.5 billion deal on April 22, 2015 - three weeks after she was appointed acting Head of Department.Simelane was standing in for the controversial Dr Sibongile Zungu whose contract had ended at the end of March 2015 after KwaZulu-Natal premier Senzo Mchunu had refused to renew it. At the time of her appointment as acting HOD, Simelane was GM: Clinical Support. Dr Zungu said on Tuesday that, as she was no longer part of the department, she felt she could not comment on the tender or the speed with which it had been awarded. Dr Simelane could not immediately be reached for comment. Dr Sifiso Mtshali, the current head of the KwaZulu-Natal health department could not be reached for comment. But on Tuesday, Mtshali had told the Daily News newspaper in Durban that he was reviewing the contract.

“When I assumed my duties I decided to take another look at the contract. It is indeed worrying that close to the financial year no procurement has been made but we have to look at all the pros and cons of the contract. I can't get into details at this stage,” Mtshali is quoted as saying. Dr Gama confirmed there had been no orders forthcoming as a result of the contract being reviewed by Dr Mtshali.