News / Local
Hospital bosses stole millions
08 Aug 2015 at 09:20hrs | Views
Dr Lawrence Mantiziba
MPILO Central Hospital executives acted as a syndicate to fraudulently bleed millions of dollars from the institution's coffers, a recently concluded internal audit has revealed.
The audit, covering the period between January 2012 and May 2015, shows that the accounting system at one of the country's biggest referral hospitals was virtually non-existent.
Auditors said officials abused resources and funds without accountability.
They have recommended that implicated officials should be charged separately and jointly where appropriate under the first schedule of the Health Services Regulations of 2006 and Treasury Instruction 0435 and 2404.
They also recommended that they be tried in a criminal court as well. The audit concluded that the system at Mpilo Central Hospital was very porous and accountability almost non-existent, leaving it open to abuse by officials.
The financial investigation showed there was no record of statutory treasury allocations in the last three years, although the government released millions to the hospital over the period.
The disappearance of GOZ files for 2012, 2013, and 2014 and renal register under unclear circumstances, hindered audit inspection, reads the report in The Chronicle's possession.
The hospital, according to the records, was run without a purchase plan with unapproved suppliers sometimes given double payment for relatively expensive goods.
The executives would allegedly use money from the Health Services Fund, meant to equip the hospital, to host lavish meetings at hotels for the tender and buying committees.
Sources from the Ministry of Health and Child Care yesterday said the Health Service Board (HSB), on Tuesday formally charged four executives who were suspended in April to pave way for the audit.
More officials, the sources said, will be charged during the course of this month.
"An official from the central buying unit, Hebron Mutema, has been added to the list of officials accused of fraudulent behaviour and abuse of office," said a source, who cannot be named for professional reasons.
Mutema allegedly connived with other officials to facilitate double payment to suppliers.
He, it is alleged, would send cash and an RTGS to pay the same supplier for the same goods, said the source.
The four suspended executives, the source said, have been formally charged with a total of 20 counts of misconduct and abuse of office.
Operations director, Regina Duduza Moyo, is facing 11 counts. Mxolisi Sibanda, the chairperson of the central buying unit, is facing five, finance director, Charles Govo, has one count and Dr Lawrence Mantiziba three, said the source without giving further details.
The hospital's board chairperson, Chelesile Moyo-Ncube, said the internal audit had unearthed a hotbed of corruption.
"We've been advised more people will be charged. The audit has revealed more serious fraud than the initial investigation done by PNA Accountants," said Moyo-Ncube.
She declined to comment further, referring questions to the HSB.
HSB executive director, Ruth Kaseke said the ministry's permanent secretary, Dr Gerald Gwinji, was better able to respond to questions.
Both Dr Gwinji and Health Minister, Dr David Parirenyatwa, could not be reached on their mobile phones yesterday.
The audit report reads: "Audit findings indicate the existence of a syndicate including buyers, PTC (Procurement Tender Committee) members and the chief executive officer. Audit unearthed abuse of office by hospital management in tender fraud, violation of State Procurement Board (SPB) requirements, non-compliance with regulations and statutes and financial prejudice to the hospital".
The auditors said the report shows on March 8, 2012, the hospital illegally awarded Markford Distributors the tender to repair an X-ray Machine without considering or inviting bids from other suppliers. The repairs cost $17,469.08. The same machine was repaired by the same company for $12,000 six months later on October 9.
The report shows the PTC could hold suppliers to ransom as it would sometimes cancel informal tenders at the final stages under unclear circumstances, resulting in waste and abuse of resources.
Millions of dollars more were paid in advance to suppliers who often failed to deliver services.
Officials at Matabele Steam Laundry alleged Govo and Duduza Moyo cancelled their laundry contract with the hospital after six months because they refused to bribe the officials to get paid for their services.
The contract was then awarded to Snowhite Pvt Ltd. In terms of the contract, Snowhite was obliged to refurbish, upgrade and instal new equipment in the hospital's laundry department prior to commencement of operation in the hospital's premises, read the report.
Snowhite began operations in January 2015, the report revealed, using the hospital's laundry equipment, without fulfilling any of the preconditions.
As at the end of April 2015, Snowhite had raised invoices totalling $53,084.72, the report reads. Auditors failed to find any benefit the hospital derived from the arrangement as most costs were being met by the health institution.
They described it as highly prejudicial as it was far more expensive than what the hospital used to pay Matabele Steam Laundry.
The auditors found out that officials bought drugs from private suppliers without government pharmaceutical watchdog NatPharm's approval, with implications that the hospital was not realising value for money on purchases. Existing stock would disappear from the stores department when the health institution bought new stock, the audit revealed.
Mpilo Central Hospital bought drugs worth more than $1 million, whose origins or quality could not be vouched for, in the last three years.
The Chronicle broke the story on the alleged corruption in February, when a $3 million tender, which had been awarded to Bulawayo businessman, Ashton Mpofu's New Planet Company, was cancelled after he allegedly refused to bribe Mantiziba and Duduza Moyo.
Mantiziba and Duduza Moyo strongly deny allegations of soliciting bribes. The latter alleged that Mpofu threatened to harm her following the cancellation of the tender and requested a bodyguard. The tender, according to the audit report, had been illegally and unnecessarily split into smaller ones. Auditors said if the contract had been given to one company, it would have cost approximately $1,049 million. After being split up, it ended up costing more than $2 million. Corruption has always been whispered about at Mpilo Central Hospital but no action was taken until Dr Parirenyatwa appointed a new board last year.
The board comprises Moyo-Ncube as chairperson, Siqokoqela Mphoko, Goodness Msimanga, Hudson Hlabangana, Prince Kunaka and Nomathemba Ndiweni.
The audit, covering the period between January 2012 and May 2015, shows that the accounting system at one of the country's biggest referral hospitals was virtually non-existent.
Auditors said officials abused resources and funds without accountability.
They have recommended that implicated officials should be charged separately and jointly where appropriate under the first schedule of the Health Services Regulations of 2006 and Treasury Instruction 0435 and 2404.
They also recommended that they be tried in a criminal court as well. The audit concluded that the system at Mpilo Central Hospital was very porous and accountability almost non-existent, leaving it open to abuse by officials.
The financial investigation showed there was no record of statutory treasury allocations in the last three years, although the government released millions to the hospital over the period.
The disappearance of GOZ files for 2012, 2013, and 2014 and renal register under unclear circumstances, hindered audit inspection, reads the report in The Chronicle's possession.
The hospital, according to the records, was run without a purchase plan with unapproved suppliers sometimes given double payment for relatively expensive goods.
The executives would allegedly use money from the Health Services Fund, meant to equip the hospital, to host lavish meetings at hotels for the tender and buying committees.
Sources from the Ministry of Health and Child Care yesterday said the Health Service Board (HSB), on Tuesday formally charged four executives who were suspended in April to pave way for the audit.
More officials, the sources said, will be charged during the course of this month.
"An official from the central buying unit, Hebron Mutema, has been added to the list of officials accused of fraudulent behaviour and abuse of office," said a source, who cannot be named for professional reasons.
Mutema allegedly connived with other officials to facilitate double payment to suppliers.
He, it is alleged, would send cash and an RTGS to pay the same supplier for the same goods, said the source.
The four suspended executives, the source said, have been formally charged with a total of 20 counts of misconduct and abuse of office.
Operations director, Regina Duduza Moyo, is facing 11 counts. Mxolisi Sibanda, the chairperson of the central buying unit, is facing five, finance director, Charles Govo, has one count and Dr Lawrence Mantiziba three, said the source without giving further details.
The hospital's board chairperson, Chelesile Moyo-Ncube, said the internal audit had unearthed a hotbed of corruption.
She declined to comment further, referring questions to the HSB.
HSB executive director, Ruth Kaseke said the ministry's permanent secretary, Dr Gerald Gwinji, was better able to respond to questions.
Both Dr Gwinji and Health Minister, Dr David Parirenyatwa, could not be reached on their mobile phones yesterday.
The audit report reads: "Audit findings indicate the existence of a syndicate including buyers, PTC (Procurement Tender Committee) members and the chief executive officer. Audit unearthed abuse of office by hospital management in tender fraud, violation of State Procurement Board (SPB) requirements, non-compliance with regulations and statutes and financial prejudice to the hospital".
The auditors said the report shows on March 8, 2012, the hospital illegally awarded Markford Distributors the tender to repair an X-ray Machine without considering or inviting bids from other suppliers. The repairs cost $17,469.08. The same machine was repaired by the same company for $12,000 six months later on October 9.
The report shows the PTC could hold suppliers to ransom as it would sometimes cancel informal tenders at the final stages under unclear circumstances, resulting in waste and abuse of resources.
Millions of dollars more were paid in advance to suppliers who often failed to deliver services.
Officials at Matabele Steam Laundry alleged Govo and Duduza Moyo cancelled their laundry contract with the hospital after six months because they refused to bribe the officials to get paid for their services.
The contract was then awarded to Snowhite Pvt Ltd. In terms of the contract, Snowhite was obliged to refurbish, upgrade and instal new equipment in the hospital's laundry department prior to commencement of operation in the hospital's premises, read the report.
Snowhite began operations in January 2015, the report revealed, using the hospital's laundry equipment, without fulfilling any of the preconditions.
As at the end of April 2015, Snowhite had raised invoices totalling $53,084.72, the report reads. Auditors failed to find any benefit the hospital derived from the arrangement as most costs were being met by the health institution.
They described it as highly prejudicial as it was far more expensive than what the hospital used to pay Matabele Steam Laundry.
The auditors found out that officials bought drugs from private suppliers without government pharmaceutical watchdog NatPharm's approval, with implications that the hospital was not realising value for money on purchases. Existing stock would disappear from the stores department when the health institution bought new stock, the audit revealed.
Mpilo Central Hospital bought drugs worth more than $1 million, whose origins or quality could not be vouched for, in the last three years.
The Chronicle broke the story on the alleged corruption in February, when a $3 million tender, which had been awarded to Bulawayo businessman, Ashton Mpofu's New Planet Company, was cancelled after he allegedly refused to bribe Mantiziba and Duduza Moyo.
Mantiziba and Duduza Moyo strongly deny allegations of soliciting bribes. The latter alleged that Mpofu threatened to harm her following the cancellation of the tender and requested a bodyguard. The tender, according to the audit report, had been illegally and unnecessarily split into smaller ones. Auditors said if the contract had been given to one company, it would have cost approximately $1,049 million. After being split up, it ended up costing more than $2 million. Corruption has always been whispered about at Mpilo Central Hospital but no action was taken until Dr Parirenyatwa appointed a new board last year.
The board comprises Moyo-Ncube as chairperson, Siqokoqela Mphoko, Goodness Msimanga, Hudson Hlabangana, Prince Kunaka and Nomathemba Ndiweni.
Source - chronicle
