Buhle Waste says government being used to fight corporate battles as SIU probes contracts

13 Jul 2022

Buhle Waste, currently holding a multimillion-rand contract for high-risk medical waste management for the Eastern Cape Department of Health, has welcomed a probe by the Special Investigating Unit as it believes the government is being used to fight corporate battles.

This is not the first time there have been questions around contracts involving Buhle Waste. Daily Maverick and Spotlight reported in June 2019 that the company was involved in contracts in KwaZulu-Natal, reportedly charging hugely inflated prices.

Last week, Justice Minister Ronald Lamola authorised the Special Investigating Unit’s probe into the manner in which the R214-million contract for Buhle Waste to manage high-risk medical waste for the Eastern Cape’s health department was awarded in 2019.

According to a reply by Health Minister Dr Joe Phaahla in February to a parliamentary question sent by the DA’s Evelyn Wilson, R44-million was paid to Buhle Waste in the 2020/21 financial year and R48-million in the 2021/22 financial year based on actual waste collected. The contract was for three years.

Phaahla added that four other provinces were also using Buhle’s services — KwaZulu-Natal, Mpumalanga, the Free State and Limpopo.

KZN is piggybacking on a medical waste contract awarded in Mpumalanga following a tender process in that province. In some cases, the Public Finance Management Act allows provinces to piggyback on contracts in other provinces — although the decision to do so has to be properly motivated. (Spotlight and Daily Maverick previously reported in its Health4Sale investigative series how Buthelezi EMS was given aeromedical contracts in Limpopo, Mpumalanga and North West using such piggybacking provisions.)

Spotlight reported in 2019 that the Mpumalanga contract had been awarded to Buhle in November 2015 for a three-year period until November 2018, and thereafter extended on a month-to-month basis. In other words, KZN is piggybacking on yet another contract that is on a month-to-month extension.

At the time of the Eastern Cape tender, the health department was headed by Dr Thobile Mbengashe who subsequently resigned and was redeployed as a consultant in the premier’s office.

Medical scooter scandal

He was later suspended after the SIU recommended he be disciplined for the role he played in the procurement of the Eastern Cape’s ill-fated medical scooters during the first wave of Covid. The scooter tender was cancelled.

During his disciplinary inquiry, Mbengashe denied that the tender for the scooters was his idea, saying that it was the project of the then MEC for Health, Sindiswa Gomba.

Gomba was relieved of her duties as MEC after the SIU probe into the scooters and after she, with several others, was charged in a case involving the misuse of funds meant for Nelson Mandela’s funeral.

In the inquiry, Mbengashe claimed that incorrect evidence was placed before the Special Tribunal by the SIU.

According to the proclamation signed by Lamola, SIU investigators are tasked with probing whether the manner in which the waste management tender was awarded to Buhle was “fair, equitable, transparent, competitive or cost-effective; or contrary to applicable legislation, manuals, guidelines, practice notes, circulars or instructions issued by the National Treasury or the relevant Provincial Treasury”.

Investigators are also expected to look into “any related losses, unauthorised, irregular or fruitless and wasteful expenditure incurred by the Department or the State, any irregular, improper or unlawful conduct by employees or officials of the Department; or any other person or entity”.

‘Suspicious timing’

Buhle Waste’s business development manager, Thabang Sekete, said the company welcomed the investigation, but that the timing was suspicious as allegations “always surface” when a big contract is about to come to an end.

“It is important that the Special Investigating Unit undertakes the work to make sure that everything that the Department of Health is doing is above board. They are there to see that everything is procedurally correct and they can check if there is any malfeasance — we hope that they can conclude that matter speedily,” Sekete said.

“We are hoping that they can do a more wide-ranging investigation into these contracts,” he said. “That would highlight something really interesting.”

He said they would cooperate with investigators from the SIU.

“I wouldn’t say it was a surprise, but I also won’t say that we expected something to come through. Every single time that a contract comes to a close or starts to come to a close, and there are major adverts for contracts, we start to see many allegations. We were mentioned in Parliament a few years ago and it cost us the ability to tender for Netcare,” he said.

“There are seasons when something is suddenly wrong and the government is used to fight corporate battles,” Sekete said.

“We are constantly getting audited and constantly getting inspections. It is important work that these government departments are doing,” he said.

“There are always suggestions that we can improve and we are always trying to improve,” he said.

“It is the nature of the business. You have to have a thick skin. As long as we can sleep at night,” Sekete said.

A spokesperson for the Eastern Cape health department, Yonela Dekeda, said it welcomed the investigation.

“Anything that will assist us with promoting good and clean governance will always be welcome as we want to ensure that every cent is accounted for,” she said.

“We commit to work with the SIU so that they can carry out their important investigation expeditiously. We are confident that the SIU will leave no stone unturned in its investigation.

“Where there is wrongdoing, we will not hesitate to take action, but we will wait for the probe to be finalised and see what the findings and recommendations will be,” she added.

SIU spokesperson Kaizer Kganyago did not respond to a request for comment on Sekete’s allegations. DM/MC

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Medical scooter scandal

‘Suspicious timing’