The Special Tribunal has reviewed and set aside a multimillion-rand personal protective equipment (PPE) tender awarded by Gauteng Department of Health to Zakheni Strategic Supplies in April 2020. On Wednesday the R103 million tender was declared unlawful.
The judgement comes after the Special Investigating Unit (SIU) applied for an order to review the PPE contract. The tender was issued by the Gauteng Department of Health in April 2020, shortly after the country recorded its first case of Covid-19.
In her judgement, tribunal President Judge Lobogang Modiba ordered the company pay back all the profits derived from the tender.
“The irregular manner in which the contract was awarded constitutes a material infraction to the constitutional values of fairness, transparency, equity, effectiveness and cost effectiveness. Therefore, it is just and equitable to set aside the contract.
“On the authority in ALL Pay, Zakheni is not entitled to profit from an irregular contract. I find no basis to exercise my discretion to permit Zakheni to benefit from the contract under the present circumstances. It is therefore just and equitable that Zakheni is ordered to account to the department for the profits earned or stands to earn from the impugned contract and to be divested of such profits,” she said.
In a statement the SIU said its investigation revealed that Zakheni was awarded a R103.7 million tender without following regulations.
“The SIU probe uncovered that, on 19 April 2020, the department, through its chief financial officer (CFO), Kabelo Lehloenya, received a quotation from Zakheni for the supply to the department of specified PPE items, like gloves and masks.
“Twenty-four hours later, the department issued a commitment letter to Zakheni, signed by the CFO. In terms of the commitment letter, Zakheni would supply PPE to the department to the value of R103 770 000,” spokesperson Kaizer Kganyago said.
The SIU said the order by the Tribunal was a continuation of the implementation of its “investigation outcomes and consequence management to recover assets and financial losses suffered by state institutions and/or to prevent further losses”.