Condom Rush 2.0

contract bungle leaves officials in a pickle

The condom contract bungle at the Department of Health has left officials in a pickle. Our investigation halted a dubious scheme to defraud the public of billions of rands

In Brief

  • Somebody’s goof at the department of health’s procurement would have cost the public nearly R2 billion
  • Department officials scrambled to fix the ‘error’, amid allegations that some senior managers are protecting one of the suppliers fingered in our series of reports

Our team of data journalists and a subsequent report by City Press exposed a goof that would have cost taxpayers nearly R2 billion, enough money to bridge the funding gap at universities.

The data that crashed the tender party

When uSpiked first raised the matter of inflated value of lubricants the department had contracted out, the director for affordable medicine, Khadija Jamaloodien, emailed our editor on August 28, 2015 stating: “On the issue relating to the quantities awarded, I have reviewed the documents to clarify the matter. In Annexure C it is clear that 60 million units will be required over a 3-year period.

“I see where the possible confusion may have arisen. The specification indicates pack of 100 (this is for purposes of packaging) but the quantity awarded in the Contract Circular indicates the number of units in relation to the specification as in Annexure C.

“This has been clarified with all contractors. Rest assured no additional volumes have been awarded to any supplier.”

It turns out Jamaloodien’s last statement was a lie. From City Press’ own inquiry, if Jamaloodien had clarified the matter with the contractors as she had claimed, then Barrs Medical, the major beneficiary of the bungle could have known about it. Responding to the Weekly newspaper, the company’s director, Joe Morris, pledged ignorant of the fact; “I didn’t know that is what the department expected of us. I don’t think I should comment any further.”

Which suppliers did Jamaloodien communicate the bungle to? Was this a secret scam to steal from the public? City Press confirmed our findings in the edition of October 11, 2015 prompting Jamaloodien to hastily sign an addendum correcting the mess. But, our trusted system called out the so-called correction.

The Condom-Pie after the contract bungle was fixed

When we fed the information into our data processing system, it appeared the scrambling officials at the department did not really know what they were doing. The addendum began by assigning Supplier Codes for suppliers whose codes had been pending, as follows: Fulloutput 1305 cc – V3Y57; Medi-Core Technologies – V3VP6 and RRT Medcon (Pty) Ltd – VDL85.

Not prominently placed though, was the replacement of a code for Barrs Medical (Pty) Ltd. In its submission for the tender, this foreign-owned company had used a supplier code assigned to Barrs Pharmaceuticals Industries (Pty) Ltd. In the addendum, Jamaloodien struck-through code V4890 and replaced it with a new one, V3X67. Mr. Morris’ new gravy train is now an officially coded supplier. The question still remains, how was the company allowed to misappropriate a code assigned to another supplier – not withstanding the fact that the same directors own the company? And if the misappropriation was by the directors of the supplier in question, why hasn’t the Department evoked Section 9.1.3 of the contract to review the award?

How the Condoms and Lubricant pie is now being distributed

The section states: “The Department reserves the right to verify any information supplied by the bidder in the Authorisation Declaration at any time. Should the information be found to be false or incorrect, the Department of Health will exercise any of the remedies available to it in order to disqualify the bid, or cancel the contract, if already awarded.”

And since nothing like that has happened, we are inclined to believe that this particular contractor enjoys some level of protection within the Department’s senior management, as has been alleged to us. The first issue that needs immediate examination is how Barrs Medical (Pty) Ltd managed to score 9.9 points (the highest point is 10) for its Black Economic Empowerment. Which BEE verification agency supplied the certificate used to land the multi-billion contract? And how would they justify the high BEE scoring?

Why did it take the department six weeks to rectify the bungle we had promptly made them aware of? Could they have just forgotten about a R2 billion bill? At least we didn’t forget.

CLICK HERE for the new pie distribution.