Pretoria – Health Minister Dr. Aaron Motsoaledi has welcomed the release of a report instituted by Public Works & Infrastructure Minister Dean Macpherson, which made damnig findings regarding the Pressure Swing Adsorption (PSA) Oxygen Plant tender.
The report released on Tuesday, 29 July 2025, by Minister Macpherson, reveals a monumental failure in governance, adherence to IDT policies and National Treasury regulations, which undermined the integrity of public procurement and threatened donor funds.
“The report therefore confirms that multiple companies awarded work under the PSA project did not have valid SAHPRA [South African Health Products Regulatory Authority] licensing,” said Minister Macpherson.
“One company, Bulkeng (Pty) Ltd, submitted a SAHPRA licence belonging to Atlas Copco Industrial SA, without the knowledge or consent of Atlas Copco.
“This was a clear misrepresentation. It was fraud.”
Moreover, Bulkeng intended to subcontract more than 25% of its responsibilities to Brutes Air Solutions, but failed to disclose this, in violation of the Preferential Procurement Regulations.
In addition, the investigators found that the bid evaluation process was deeply flawed.
“The SAHPRA compliance requirement – originally stipulated in the Project Execution Plan and the Department of Health’s Memorandum of Agreement, was deliberately removed from the final Request for Proposals,” the minister said.
“This opened the door for ineligible bidders to participate and win massive contracts.”
Commenting on the report, Minister Motsoaledi expressed his satisfaction that it will “finally remove the cloud hanging above the tender whose ultimate success would ensure 55 hospitals in the country would have the infrastructure to supply the much-needed oxygen for the selected institution”.
Minister Motsoaledi said that those found to be on the wrong side of the law will be held to account.
“They did not just commit financial corruption, but deprived South Africans of urgent life support in the form of oxygen,” Minister Motsoaledi said.
“As such, the Department of Health would like to see people being held to account and the law taking its course.”
Minister Motsoaledi said he was “pleased that the Department of Health lost nothing and all the money that has been donated by the Global Fund is safe”.
Minister Motsoaledi added: “I am pleased to note that a credible forensic investigation has gotten to the bottom of this matter to bring this matter to a close.
“I am also satisfied that the report has not pointed any fingers at the Department of Health for any financial misdemeanour that may cast aspersions on the integrity of the department, because it would have soured our relationship with the Global Fund.”
This tender was intended to deliver life-saving Pressure Swing Adsorption Oxygen Plants to hospitals across the country.
It was a project worth R836 million, of which R528 million had been allocated directly to the IDT for implementation.
However, red flags emerged when some of the project costs inexplicably increased from R216 006 750 to R592 564 687 when the market was tested, which is a 174% increase from the initial estimated budget.
When reports of possible corruption broke out in the public media, the health minister, in consultation with his Public Works counterpart, removed the tender from the IDT and took it to the Development Bank of Southern Africa (DBSA) so that the project could continue and deliver the much-needed Oxygen.
He said that with the report released, the remaining work of the DBSA will surely be expedited to conclude the project as expeditiously as possible to the benefit of the people of South Africa.
Meanwhile, the IDT Board of Trustees said it noted the serious findings highlighted by Minister Macpherson, including evidence of procurement irregularities, governance failures, and regulatory breaches related to the PSA Oxygen Plant project.
“We echo the Minister’s commitment to clean governance, institutional accountability and the protection of public and donor funds.
“The Board has not yet concluded its internal deliberations.
“In line with our fiduciary responsibilities, we are carefully processing the contents of the report and will be convening formally to consider the appropriate next steps.
“We are committed to ensuring a lawful, fair, and transparent response guided by both the recommendations of the report and the requirements of our internal policies.”
The board assured all stakeholders that it takes these matters seriously.
The Board said it was determined to restore institutional credibility, rebuild confidence in the IDT’s procurement and governance systems, and uphold the trust placed in us by the South African public.
Members of the IDT Board of Trustees include:
- Ms. Zimbini Hill (Chairperson),
- Prof. Raymond Nkado (Deputy Chairperson),
- Ms. Lerato Kumalo, Ms. Thobile Maloka,
- Dr. Deenadayalen Konar, Mr. Neil Jansen,
- Mr. Derek Naidoo,
- Ms. Sekadi Phayane-Shakhane,
- Ms. Bongekile Zulu,
- Mr. Matodzi Ratshimbilani,
- Prof. Stella Bvuma,
- Mr. Wayne Manthe
- Ms. Tebogo Malaka (Chief Executive Officer)
