Gauteng Health on tender processes

Reasons for deviating from tender processes

The Gauteng Department of Health has awarded 423 contracts above the value of R500 000 in the past two financial years.

Two travel agents were appointed to assist with South African Medical students who are studying in Cuba over two financial years we spent more than R4 million.

In one contract, the department couldn’t go through a competitive bidding process because Philips Medical was a preferred supplier and they were awarded the contract for the supply and delivery of X-Ray equipment at Thelle Mogoerane Hospital. However, the contract didn’t include the installation which necessitated the building alterations.

Phillips prefers to utilise their own contracted service providers and the department ensured that the Department of Infrastructure Development is also involved to supervise the external contractor in the 2014/15 financial year. About R780 654.90 was utilised in the project.

In another contract of the same year, the department couldn’t follow the competitive process due to the fact that the bed screens, curtains and curtain rails were needed urgently for the official opening of the Thelle Mogoerane Hospital.

In another contract awarded in 2015/16, the department couldn’t follow the competitive bidding process because the GPG resolved to commemorate the Provincial AIDS Week within the City of Tshwane.

Therefore there was a need for the venue that has Exhibition Halls, Conference Rooms with equipment; and Outdoor Facilities and the Tshwane Events Centre was found to be suitable and met requirements within the City of Tshwane. About R2 856 384 was utilised accordingly.

Department could not follow the competitive bidding process in the appointment of BMGI, due the fact same was appointed through Section 10.5 of SCM Practice note no 3 of 2003 (Appointment of Consultants) which empowers the Accounting Office (HOD) to appoint the Consultants through a “single-source selection” when only one firm is qualified or has experience of exceptional worth for the assignment, amongst others. About R12 600 000 was utilised in 2015/2016.

The reason for the department not to go through a competitive bidding process of appointing Lean Institute is that the Lean Institute Africa is a section 21 non-profit company established to promote lean management in South Africa and the rest of Africa. It is based at the Graduate School of Business of the UCT and is a member of the Lean Global Network (a network of 18 lean institutes world-wide.

Lean Institute is body that specialises in lean management and department got the value for money from the original source of lean management. As a non-profit making organisation the fees for the work done when seen as reasonable. About R1 730 289.11 was utilised.

In all these contracts which did not go through a competitive process, all services were rendered on time and within the allocated budget.

The department has established a Demand Management Unit to ensure that all health institutions compile Demand Management Plans and Annual Procurement Plans linked to their available budget/s, to ensure that procurement that is above R500 000 follow the competitive bidding process.

In the current financial year 2016/17, the department has subjected seven projects to the Open Tender Process. These projects are estimated at total value of R1.6 billion.

Source: Government of South Africa.

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