Statement by Freddy Sonakile – DA Spokesperson on PPAC in North West:
The Department of Health appeared before the Provincial Public Accounts Committee (PPAC) yesterday to account for its 2024/25 audit outcomes. What emerged was a disturbing picture of a department in deep financial distress, with weak controls and chronic cash-flow problems.
Shocking details revealed include:
Accruals on track to exceed R2 billion;
- The repurposing of R150 million from Compensation of Employees to Goods and Services in an attempt to suppress accruals;
- No electronic invoicing system directly undermines 30-day payments to service providers;
- R55 million in accrued revenue relating to foreign national accounts as at 31 March 2025;
- Medico-legal claims of R63 million;
- Legal fees totalling R41 million;
- R177 million spent on infrastructure maintenance, acknowledged as far below what is required.
The Department also reported that the Brown Mogotsi Foundation had interdicted what it referred to as the “Tender-A” for food services. The interdict later fell away after the Foundation withdrew its court action.
Upon further probing, the Department confirmed the existence of a second food services tender (“Tender-B”), where a company linked to the Tembisa Hospital saga had submitted a bid. Aloo Construction and Supply, the company widely reported in the media for allegedly submitting fraudulent documents, also interdicted the Department on this second tender. That matter is still before the courts.
While the Department claimed that Aloo Construction had “fallen off” from the bid because its pricing was too high, the DA made it clear: disqualification on pricing does not erase the fraudulent act. If fake documents were submitted, the elements of fraud are met, regardless of the pricing outcome.
The DA has demanded that the Department:
- Use the SIU’s findings to verify the legitimacy of the company’s documents;
- Lay criminal charges of fraud, forgery, and uttering against the owners; and
- Pursue civil recovery, as the Department has suffered direct financial losses due to the interdict, which forced urgent alternative arrangements to ensure an uninterrupted food supply for patients.
Fraudulent bidders cannot be allowed to weaponise the courts and hold the public healthcare system hostage.
The DA reiterates that the Department and Provincial Treasury must urgently sit around the table to develop a concrete plan to address the fiscal pressures experienced by the Department.
We acknowledge that, at the very least, the Department was upfront about its challenges and has been instructed to return with clear turnaround plans and timelines.
The DA will monitor PPAC’s recommendations closely. If the Department fails to act on cases of fraudulent tender submissions, the DA will proceed to open criminal charges independently.
Fraud in the procurement of essential patient services is not a procedural issue; it is a crime, and it must be treated as such.