Minister Slams R800 Million Oxygen Tender Scandal as Fraud and Mismanagement

image: Full View

by Kelebogile Matlou

Minister of Public Works and Infrastructure Dean Macpherson says a report into a R800 million government tender shows a serious failure in how public money was handled. The tender was for building oxygen plants at state hospitals and was given out by the Independent Development Trust (IDT).

The report was done by auditing firm PwC. It found that the way the tender was given out did not follow the rules. It also found signs of corruption, misuse of money, and lies from some of the companies that applied.

Macpherson said he is glad his department started the investigation early, even though some people criticised them at the time. He explained that the tender process was badly managed. For example, IDT CEO Tebogo Malaka did not do proper oversight, and some of the companies did not have the legal documents they needed to qualify.

“One company, Bulking Pty Ltd, used a licence that actually belonged to another company Atlas Copco without their knowledge. That’s fraud,” said Macpherson.

The report also showed that eight companies were chosen to do the work, but they were not asked to prove they met all the requirements. In fact, important rules that were part of the original project plan were removed before the tender was advertised. This allowed companies that should not have qualified to win large contracts.

The minister said that meeting notes were missing or incomplete, and people sat on the bid panels who were not supposed to. The scores for the bids were also not properly written down. Another major concern was the cost. The project was first expected to cost R216 million, but it later jumped to almost R600 million. That’s a 174% increase.

PwC has recommended that the government take action against those involved, including the IDT CEO and others. Macpherson said his department is serious about fighting corruption and making sure public tenders are handled properly. “This report proves that big mistakes were made. Some people tried to cheat the system, and they must face the consequences,” he said.