The Minister of Public Works & Infrastructure, Dean Macpherson, has dismissed the Independent Development Trust’s (IDT) intention to investigate the processes followed in awarding the Pressure Swing Adsorption (PSA) Oxygen Plant bids, as the board of trustees is currently not quorate and cannot investigate itself.

The board currently comprises seven out of its 12 constituted members, with a quorum set at eight members. This is an issue the Minister is currently seized with and will announce a way forward in due course.

The Minister, as the Executive Authority to which the IDT is accountable to, will therefore launch a full independent investigation into the IDT and its corporate governance challenges to prevent any possible abuses and corruption going forward.

The Minister’s actions follow several attempts over the past weeks to obtain documentation from the IDT board regarding the PSA Oxygen Plant tender. The tender involved awarding contracts amounting to over R800 million to three companies to install oxygen plants in hospitals, despite two of the companies lacking South African Health Products Regulatory Authority (SAHPRA) registration, and one potentially submitting fraudulent documentation.

The following provides a detailed timeline of the interactions between the Minister of Public Works and Infrastructure, and the IDT as it relates to the PSA Oxygen Plant tender:

• 28 October: Daily Maverick reports that three companies were awarded an R836 million PSA Oxygen Plant tender, despite two lacking SAHPRA registration.
• 29 October: Minister Macpherson requests the IDT board to provide a comprehensive account of the allegations made in the Daily Maverick article.
• 1 November: IDT provides Minister Macpherson with an executive summary of the circumstances surrounding the PSA Oxygen Plant tender, which lacks supporting documentation. 
• 5 November: Minister Macpherson writes to the IDT board requesting additional supporting documentation, including signed contracts and minutes from the Bid Evaluation Committee (BEC) and Bid Adjudication Committee (BAC) meetings.
• 8 November: The IDT provides the Minister with additional documentation but fails to include the full bid documents, despite it being specifically requested.
• 11 November: A second Daily Maverick article is published, alleging that a ghost company, possibly with fraudulent documentation, was awarded a R428 million PSA Oxygen Plant tender.
• 15 November: Minister Macpherson writes to President Cyril Ramaphosa briefing him on the allegations surrounding the PSA Oxygen Plant tender.
• 18 November: Officials from the Department of Public Works & Infrastructure provide all information received from the IDT to the Department of Health.
• 19 November: Minister Macpherson writes to the IDT board requesting the immediate suspension of the tender for the roll-out of the PSA Oxygen Plants due to concerns around the tendering processes followed.
• 5 December: The IDT informs Minister Macpherson that the National Department of Health has communicated its intention to withdraw the contract from the IDT.

  “My interactions with the IDT over the past two months have raised serious concerns about governance within the organisation. I expressed these concerns in person to the IDT during a meeting regarding their quarterly performance, as well as their continued inability to finalise financial statements for the 2023/2024 financial year. It is patently clear that an organisation cannot and should not be allowed to investigate itself. Furthermore, due to the inquorate nature of the trust, it is not empowered to take such a decision. This is why I will be appointing an independent firm to investigate the alleged corporate governance failures that have led to this breakdown in trust,” Minister Macpherson said.

Minister Macpherson expressed his gratitude for the collaboration and support he had received from the Minister of Health, Dr Aaron Motsoaledi, whom he had briefed on numerous occasions and to whom he had provided as much information as possible. He said, “The way in which Minister Motsoaledi and I worked together in the best interests of South Africans on this matter is truly commendable to ensure access to life-saving oxygen, and to shed light and accountability on this tender when the facts became known to us.”

“We simply cannot allow close to a billion rand in public funds to be potentially lost through alleged corrupt activities, particularly when it involves essential healthcare equipment intended to save lives. We are working urgently to ensure accountability and to hold any wrongdoers responsible. As I stated when I took office on 3 July, the era of corruption and abuse within the Department of Public Works & Infrastructure is coming to an end.”

James de Villiers 
Spokesperson to the Minister 
Cell: 082 766 0276

#GovZAUpdates