DA questions Gauteng health's tender system after R304m RAF claim

The Democratic Alliance (DA) has revealed that the Gauteng health department paid out R220 million to a company to do investigative and administrative work to claim from the Road Accident Fund (RAF) in the past three years.

In a statement on Wednesday, DA MP Jack Bloom said Acting Gauteng health MEC Jacob Mamabolo had confirmed the matter in a written reply to the party's questions in the Gauteng Legislature.

Bloom said the company, Batsumi Claims Management Solutions, was paid R220 million while it collected R524 million from the RAF according to Mamabolo.

"This amounts to an exorbitant 42% collection fee as the department only received R304 million of the RAF money," he said.

He continued to say: "Mamabolo says that the department outsourced the collection of accident information because of its legal nature and lack of internal capacity to collect information and get accident reports from the South African Police Services (SAPS) and Metro police.

"Batsumi has had a contract with the department since 2006, initially through an open tender, but the second award for this contract was through participation of the Free State department of health tender in terms of Section 16.A6.5 of Treasury Regulations."

Bloom further said "it was suspicious that an open tender process was not followed" even though Mamabolo argued that the contract enabled the department to meet its annual revenue targets.

"I find it suspicious that an open tender process was not followed for Batsumi's second contract, but instead piggybacks on a tender from another province.

"There are surely other companies that can do this work at a much lower rate," he added.

He added that Batsumi's 14-year contractual relationship with the department should have been reviewed a while back.

"Premier David Makhura praises the open tender system, but there are far too many examples where it is bypassed, as in this 14-year contractual relationship that should have been reviewed long ago.

"There are lots of these long-term cosy contracts either because of inefficiency or corruption. A management shake-up is needed to ensure that all contracts are awarded through a fair competitive process," he concluded.

(Compiled by Molefe Seeletsa)

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