College of College of Graduate Studies
Public procurement for healthcare services: Impact on welfare
Dr Chibuikem Nnaeme, a postdoctoral fellow at the SARChI Chair in Social Policy at the College of Graduate Studies, presented a webinar on the government’s impact on ensuring social welfare through public procurement for healthcare services. He used the Life Esidimeni tragedy and the Covid-19 pandemic as case studies to explore the impact of public procurement on social welfare.
Nnaeme pointed out that procurement is an integral part of governance since it is the primary responsibility of the government to ensure that value for money is achieved through attempts to secure goods and services at the most cost-effective prices (Fourie & Malan 2020:2). The government has a clear understanding of its procurement power. In terms of section 217(1) of the South African Constitution, procurement must take place in accordance with a system that is fair, equitable, competitive, transparent and cost-effective to ensure that the primary goals are met. The secondary goal is then transformation.
Nnaeme said that there is a need to examine procurement and social outcomes. For example, in the case of the Covid-19 pandemic, the Special Investigating Unit (SIU) report indicates that some officials violated the official procurement processes. To understand how this impacted the social welfare outcomes and the government objectives, Nnaeme analysed the Covid-19 pandemic and the personal protective equipment (PPE) procurement processes. The resulting report revealed preferential treatment, conflicts of interest, political pressure and lack of licences to perform the contracts, and excessive profit-making.
In respect of Life Esidimeni, Nnaeme noted that the Ombudsman report mentioned that NGOs confessed that they were prevailed on in 2015 by the head of the department to see this marathon project as a business opportunity to increase their income rather than to ensure that patients received adequate healthcare services. Within three months in 2016, an estimated 1 371 chronic healthcare patients were transferred from Life Esidimeni facilities to non-governmental organisations (NGOs). Some of these NGOs did not have any medical experience. The transfers were also not communicated to the family members of the patients. A total of 144 patients died in "unlawful circumstances" in the care of the NGOs. No procurement process was followed in the selection of the NGOs, even though an initial payment of R531 997,97 had been made (Moseneke 2018:25). Also, some of the NGOs acquired their licences months after they had taken in the patients.
Nnaeme emphasised that health procurement is meant to promote welfare. However, the cases he examined showed how procurement processes undermined social welfare. He said that in these kinds of issues, people’s ulterior motives undermine social welfare, adding that transformation should not be in opposition to the interests of the public.
* By Hanli Wolhuter, Communication and Marketing Specialist & Musa Buthelezi, Intern, College of Graduate Studies
Publish date: 2022-12-07 00:00:00.0
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