R650m irregular Gauteng hospital security contracts extended for three years

Issued by Jack Bloom MPL – DA Gauteng Shadow Health MEC
04 Sep 2019 in Press Statements

Irregular Gauteng hospital security contracts worth R650 million a year that were awarded in 2014 have been extended on a month by month basis for three years.

This was revealed by Gauteng Health MEC Bandile Masuku in a written reply to my questions in the Gauteng Legislature.

The security contracts were awarded in October 2014 for a two year period, but instead of advertising for new contracts to start in October 2016 the old contracts have been extended every month since then.

This is despite the fact that a forensic audit found irregularities and criminal charges were laid against the Chairperson of the Bid Evaluation Committee that awarded the contracts. Furthermore, the Auditor-General last year criticized the renewed contracts as irregular expenditure.

Another irregularity is that according to Treasury regulations extended contracts should not increase in price by more than 15%, but this has been breached.

According to Masuku, the extension of the contracts was because they were “for non-negotiable goods and services and were extended in order not to disrupt nor compromise patient care and ongoing patient services.”

This is a weak excuse as there are lots of security companies and it is easy to put out new security tenders.

The Department’s security costs have more than doubled in the last five years and I suspect that there is gross overcharging and the contracts were allowed to continue because of corruption.

New security contracts should be awarded in an open process that ensures competence and best value for money.