‘Irregularities’ spotted fast

It was the Gauteng health department’s suspended supply chain chief director, Thandy Pino, who blew the whistle and alerted authorities to the R2bn personal protective equipment (PPE) scandal.

A trail of e-mails the Sunday Times obtained show that Pino sounded the alarm in just her second week on the job, pointing out irregularities in Covid-19 contracts being awarded without legal procurement processes being followed.

In an e-mail on April 6 that Pino sent to department head Mkhululi Lukhele, chief financial officer (CFO) Kabelo Lehloenya and others, she questioned why the department wasn’t complying with guidelines issued by the National Treasury.

Lehloenya resigned in May. Pino has been suspended while the Special Investigating Unit (SIU) investigates the department’s entire Covid-19 procurement process.

Pino’s suspension letter lists “gross misconduct, gross dereliction of duty and/or gross negligence in the performance of her official duties” as reasons for her suspension. The department accuses her of trying to “impede” the SIU investigation by “trying to create or perpetuate a fraudulent false impression” that the purchase order given to Royal Bhaca Projects, a company owned by Thandisizwe Diko, the husband of presidency spokesperson Khusela Diko, was a donation.

However, in her e-mail, Pino warned that: ● Companies being awarded contracts were not on the centralised supplier database;

● Suppliers were paid as sundry creditors;

● Commitment letters did not include quantities of goods required and risked being manipulated;

● Deviations — or amendments to the contracts — were conducted after the contracts were awarded;

● The government departments on behalf of which the health department was buying PPE were not consulted about what was needed; and

● The CFO’s office had taken over all the procurement, leaving her out of it completely.

“I have been with the department for seven days and I said it is my professional and ethical responsibility to formally bring to your attention. I therefore request that as my seniors, please engage and give me direction on how to best perform my duties,” she wrote in the April 6 e-mail.

In a lengthy response e-mailed the following day, Lehloenya defended herself

I therefore request that as my seniors, please engage and give me direction Thandy Pino

Gauteng health department supply chain director

against Pino’s allegations. Lehloenya said she centralised procurement because SA was in a state of disaster. “Ms Pino seems to be struggling to understand that the country is operating under the Disaster Management Act, which means that it is not business as usual, hence I have centralised,” she wrote.

Lehloenya also defended awarding contracts to companies that were not on the centralised database, saying that because of a global shortage of PPE, the department would buy it from anyone running a “legitimate businesses in SA”.

She said she had explained the process in a meeting with provincial treasury officials.

“At the same meeting the CFO advised GPT [the Gauteng provincial treasury] of instances where supplies were obtained from service providers who were not on CSD [the centralised supplier database], that, however, these service providers could not be rejected as they had the required PPE at the required price,” she wrote.

Lehloenya said she had put measures in place to ensure that the pricing of goods was in line with the Treasury’s instruction, and denied that the “end users” or other departments were not consulted.

“It is concerning that Ms Pino would lie in her second week of work at GDOH [the Gauteng department of health]. Almost all commitment letters are written by Ms Pino,” Lehloenya wrote. She said Pino had “committed mistakes in almost all the [commitment] letters she drafted and sent to service providers. A commitment letter of R4.0-million was issued at R873.4-million. The service provider has advised that based on this commitment he made certain commitments which he cannot reverse. I am engaging with the service provider to accept the withdrawal of the letter and revert to the original order. Ms Pino has in the meantime replaced an incorrect commitment letter with another incorrect commitment letter.”

Pino referred questions to the Gauteng health department. Through her spokesman Tshwane Malope, Lehloenye declined to comment saying she was cooperating with investigators.

After the exchange of e-mails and a series of meetings, Gauteng Audit Services was called in on the instruction of health MEC Bandile Masuku, who has since taken leave. The internal auditors recommended a forensic investigation be undertaken, and premier David Makhura roped in the SIU.

It was the video posted by Gauteng businessman Hamilton Ndlovu, showing off luxury vehicles that he bought for his family, that raised suspicions about politically connected businesses having benefited from government Covid-19 spending.

Masuku is said to have requested a list of companies that were awarded contracts. Ndlovu’s companies were not on the list.

Sources close to Masuku said this week that it was then that he picked up the name of Royal Bhaca Projects.

The Sunday Times has learnt that Masuku was interviewed by the SIU last Friday. Insiders say he was made to answer 138 questions during a session that lasted four hours.

The SIU put before him a list of 30 to 40 companies, with the names of their directors, and asked if he personally knew them. He has also appeared twice before the ANC Gauteng integrity commission.