South Africa: R257m PPE Contract Declared Invalid

The Special Tribunal has declared as invalid and set aside a R257 million COVID-19 personal protective equipment (PPE) contract awarded by the Gauteng Department of Health (GDoH).

The contract was awarded to Nkhane Projects and Supply.

The case was brought to the Special Tribunal by the Special Investigating Unit, which sought to have the contract overturned as it did not, amongst others, comply with the prescripts of the Public Finance Management Act (PFMA).

“The SIU’s application to the Special Tribunal followed an investigation that found Nkhane had made an unsolicited proposal to the GDoH outside of a competitive bidding process. No request was made for a deviation from normal procurement procedures, and none of the required procurement prescripts were followed,” the SIU said.

The corruption-busting unit called the Special Tribunal judgement a crucial step in bringing COVID-19 wrongdoers to account.

“In the judgement… the Tribunal ordered Nkhane to submit audited statements within 30 days, detailing its income and expenses related to the PPE delivered under the invalidated contracts.

“These statements must be supported by expert reports. Additionally, Nkhane is required to pay the Special Investigating Unit’s costs for the application, including the costs for two counsels where applicable.

“This judgement is expected to bring to an end to the High Court case where Nkhane demanded payment of R89 350 280.10 from the GDoH. This amount includes R60 863 045.90 for goods already delivered but not yet paid for by the GDoH, and R28 487 234.20 for goods ordered by the GDoH but which the department is refusing to accept delivery of. The High Court case was formally stayed by the SIU, pending the finalisation of the Tribunal case.

“This judgement signifies a crucial step in addressing corruption and ensuring accountability in PPE procurement during the COVID-19 pandemic,” the SIU said.