Health department accused of fraud

Johannesburg - The Gauteng health department has lost millions of rands through maladministration and tender rigging, The Star newspaper reported on Tuesday.

According to a report by Auditor General Terence Nombembe, the department appointed contractors who did not have the correct qualifications and competence to build hospitals.

Nombembe found Ilima Construction was awarded a R1bn contract to build hospitals in Gauteng, the North West and Eastern Cape. The contract was terminated after the department discovered the company's "construction grade" only allowed it to work on projects worth between R30m and R100m.

According to the report the department had awarded three contracts worth R887m to a company that failed to submit a tax clearance certificate.

A R21.9m project at Sterkfontein Hospital in Krugersdorp was terminated because of "insufficient progress" and a replacement contractor was appointed for R12m.

Democratic Alliance MP Jack Bloom was quoted as saying the AG's report illustrated the department's "disastrous incompetence".

"The distressing thing is that nobody has been held accountable for this appalling mess. Nobody has been fired or disciplined, so the mismanagement is likely to continue," he said.

Provincial health spokesperson Simon Zwane told the newspaper the department was making an effort to improve the situation.

An unqualified audit report did not mean the department was in a disastrous state, he said.