'Three Amigos' water purification tender scandal unpacked at state capture inquiry

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Johannesburg - A PWC investigator has told the Zondo Commission into State Capture about how top KwaZulu-Natal politicians were charged for corruption and fraud in the infamous 'Amigos case' involving the procurement of water purification and oxygen equipment for KZN hospitals.

Trevor White of PricewaterhouseCoopers took the stand for the third day on Wednesday and detailed how his investigation into corruption allegations at the Department of Health in KZN.

PwC was hired by the department to investigate the awarding of the oxygen and water purification tenders awarded in 2006/7.





He said the investigation found there were various irregularities involving the procurement of the water purification equipment and oxygen plants for some of KZN hospitals from a Cape Town-based company, Intaka.





White said a tender bid was advertised by the department in 2007 for the procurement of oxygen plants for hospitals in KZN.





He said during the investigation it was found that Intaka’s director, Dr Gaston Savoi, had played a critical role in drawing up the tender specification requirements for the tender.





He said emails between Savoi and KZN department of health head Dr Busi Nyamezi, had shown that the company had been involved in drawing up the specifications to their benefit.





This resulted in Intaka being awarded the tender to supply the oxygen plants.





“Dr Savoi sends an email to Dr Nyambezi where he states that some of the specifications in the tender advert were not in line with his company and so an email was sent back to Dr Nyambezi which deleted some of the specifications that did not align with theirs. His (Savoi’s) changes ended up in the final bids that were advertised.”





“It is clear that Intaka was advising the department on what to include and what not to include in the tender process. It was a big tender to supply 52 hospitals in KZN. Intaka had a hand in putting together the specifications for the tender,” White said.





“Those specifications were approved by the bid specifications committee. The winning bidder was ultimately Intaka and the losing bidders appealed and they were overruled.”





White said investigations revealed that the pressure for Intaka to be awarded the tender had come from the MEC of the department of health at the time, Peggy Nkonyeni.





He said two payments of R500,000 were found to have been made by Intaka into a company with links to Nkonyeni’s boyfriend, Linda Mkhwanazi. White said Nkonyeni and Mkhwanazi had also had a night stay in Cape Town which was funded by Intaka.





White’s investigation had also found various communication and dates for meetings between Savoi and the couple, Nkonyeni and Mkhwanazi.





The investigator also told the commission about an R1million payment that was made into a trust account. He said it was found that money was paid by Intaka to the account which went to fund the lifestyle of Sipho Shabalala who was a Treasury official in KZN.





Savoi had claimed that the R1 million payment was for a donation to the ANC. White said this was likely used as an excuse to clear Shabalala’s name. No record of the “donation” was found in the ANC books.





“The introduction seems to have come from Mr Shabalala, who was the head of Treasury. This was the kind of relationship it must have been, because there was pressure from high above to do work with these companies. The lower-ranking officials would push back and these things would take months to be put through, but they ultimately get overruled”.





Political Bureau