By Lehlohonolo Lehana.
Department of Public Works and Infrastructure minister Dean Macpherson has released the findings of the forensic investigation into the controversial R800 million Pressure Swing Adsorption (PSA) Oxygen Plant tender.
The IDT, is a public entity which reports directly to the department of public works.It delivers social infrastructure such as schools, police stations and clinics.
The tender was awarded to a company called Bulkeng at an inflated value by the Independent Development Trust (IDT).
The deal was signed off by Dr Sandile Buthelezi, health department’s beleaguered director-general. The payment of R500,000 was reportedly made in connection with another project the IDT had managed on behalf of the Department of Health (DoH).
The DoH’s budget for the oxygen plants roll-out, meanwhile, stands at R836-million. This is made up of Bulkeng’s bill of R428-million, plus a further R152-million set to be paid to another controversial contractor and its joint venture partner.
Additional professional fees, management fees and maintenance costs are also included in the budget, explained the DoH. The project is being bankrolled by The Global Fund, an international organisation that pools resources for health projects in various countries.
Macpherson announced in 2024 an investigation would be conducted by PricewaterhouseCoopers (PwC) into the awarding of contracts to three companies for pressure swing adsorption (PSA) oxygen plants.
Among the allegations is a claim that a ghost company had been awarded a R428 million share of the oxygen plant tender possibly with fraudulent documentation.
Bulkeng a “ghost company” with no online presence, no offices and a very elusive director, secured the largest portion of the oxygen plants roll-out.
Bulkeng is not registered with Sahpra and seemingly used the certificate of another company without its knowledge.
The IDT has claimed that Bulkeng was in a joint venture partnership with an entity named “Brutas Atlas Copco Industrials South Africa”. This entity supposedly held the Sahpra certificate Bulkeng would have needed for its bid.
Macpherson briefed the media on the outcomes of the investigation in Pretoria.
The briefing follows the minister’s commitment to act decisively on allegations of corruption and procurement irregularities in the department and its entities.
The report exposes systemic governance failures, procedural breaches, and outright fraud that have plagued the IST for years and threaten South Africa’s public health infrastructure and integrity.
“From the moment I stepped into this role, I was already aware of long-standing allegations of maladministration, financial misconduct, and corruption at the IDT,” Macpherson said.
“These concerns have haunted the agency for years; unfinished projects, irregular tenders, and audit disclaimers have severely damaged its credibility.”
The latest scandal, which came to light in October 2024, revealed alarming details about the procurement process for the PSA Oxygen Plant project. With a budget of R836 million, this crucial initiative was to supply oxygen systems to 60 hospitals nationwide. Of this, R528 million was allocated directly to the IDT.
The forensic report, which Macpherson presented publicly, indicates that companies awarded contracts lacked proper certification, verifiable contact details, or legitimate operational capacity.
The report highlights a litany of procedural breaches, including missing meeting minutes or incomplete procurement committees that were improperly constituted; bid evaluation scores were inadequately documented; and price negotiations lacked transparency.
The investigation further revealed that one company, Bulkeng (Pty) Ltd, submitted a SAHPRA license belonging to Atlas Copco Industrial SA without authorisation – a blatant act of fraud. Additionally, Bulkeng planned to subcontract over 25% of its responsibilities to Brutes Air Solutions but failed to disclose this, violating the Preferential Procurement Regulations.
The report recommends disciplinary action against IDT CEO Tebogo Malaka, General Manager for Supply Chain Management Molebedi Sisi, and other officials.
Macpherson said he has written to the Hawks, briefed the Minister of Health, and the IDT Board to initiate consequence management.
He confirmed that the department would implement all recommendations as part of broader supply chain reform.
“These findings represent a monumental failure in governance and adherence to IDT and IDT policies and National Treasury regulations – undermining the integrity of public procurement and threatening donor funds,” the minister said.
He also reaffirmed the appointment of a new full-term IDT board, led by Chairwoman Zimbini Hill and Deputy Chair Professor Raymond Nkado, tasked with turning the agency around.