Public Works minister gives Independent Development Trust until Friday to explain oxygen plant tender

Public Works and Infrastructure Minister Dean Macpherson said on Tuesday, 29 October 2024, he had written to the chairperson of the Independent Development Trust (IDT) giving him until Friday to submit a “comprehensive report” explaining how three companies were awarded lucrative tenders to install oxygen plants in hospitals despite two lacking South African Health Products Regulatory Authority (Sahpra) registration.

“As the minister responsible for the oversight of the IDT, I must ensure that there is transparency and accountability,” Macpherson told the IDT, which falls under his department.

This follows an investigation by Daily Maverick’s investigative unit Scorpio which revealed the IDT acted as a project manager for the Department of Health to appoint private contractors to install oxygen plants at 55 government hospitals for a total of R836-million.

Read more: ‘Ghost company’ bags R428m oxygen plants tender for state hospitals

The IDT’s mandate is to support all spheres of government with social infrastructure management and programme implementations, according to its website. 

It acted as the project manager for this first-of-its-kind project in South Africa, the entity reported in a statement released earlier in October. 

According to Daily Maverick’s investigation, the tender process was fraught with alleged irregularities – including when a little-known company, Bulkeng (Pty) Ltd clinched an R428-million deal to install highly technical pressure swing adsorption (PSA) oxygen plants at government hospitals all over the country.  

Daily Maverick reported that Bulkeng had submitted tenders for a wide range of government contracts, but little information could be found about the company. Bidders for the Department of Health contract were required to be registered with Sahpra and Daily Maverick confirmed it was not listed on Sahpra’s database.

The Department of Health’s initial cost analysis for the project was R256-million, which rose to R800-million after the IDT became involved. 

In his statement, Macpherson said: “As the Minister of Public Works and Infrastructure, I take these allegations very seriously.”

He said the IDT, like any state institution when it contracted for goods and services, “must do so in a system that is fair, equitable, transparent, competitive, and cost-effective”.

Macpherson said Daily Maverick’s article raised “several significant concerns about the process followed in the appointment of Bulkeng (Pty) Ltd, Maziya General Trading, and On Site Gas Systems International by the IDT” – noting the other companies awarded contracts for the project.

IDT spokesperson Phasha Makgolane told Daily Maverick on Tuesday evening: “The Minister of Public Works and Infrastructure is the executive authority of the IDT, therefore the IDT and the department have established protocol on how to communicate to/with each other. The IDT will not communicate to the minister through the media.”

According to the Auditor-General’s office, the IDT received a qualified audit with findings in the 2022/2023 financial year, the second year running. That was an improvement from 2019/2020 and 2020/2021, when the entity received a disclaimer audit outcome.

Read more: Health department in heart of corrupt darkness, again — and with it, the ANC’s astounding failure

Meanwhile, the Democratic Alliance’s spokesperson on health in Parliament, Michele Clarke, said the party would request the IDT to appear before Parliament’s health committee to “explain its role in the tender award and to provide clarity on the measures taken to vet suppliers for critical health services”. DM