Lesotho: Govt Cuts Ties With the Tšepong Consortium

THE government has resolved to cut ties with the Tšepong Consortium which has run the Queen Mamohato Memorial Hospital (QMMH) since it opened its doors to patients in 2011.

The parasitic relationship between the government and the Tšepong Consortium has been a cause for concern for many years with the Consortium gobbling half of Lesotho's entire health budget of M582, 1 million, most of which ends up in the pockets of South Africa's major hospital chain, Netcare.

Health Minister Semano Sekatle announced the decision at a press conference at his ministry's headquarters in Maseru late yesterday.

QMMH was opened in October 2011 to replace Queen Elizabeth II Hospital as the country's major referral healthcare facility.

Mr Sekatle said the government felt it could no longer continue its 18-year Private Public Partnership (PPP) entered into 2008 with the consortium for the construction, running and transfer of the hospital due to serious differences which had plagued the agreement from the very beginning.

South African healthcare group, Netcare, had formed the consortium with local companies. In October 2008 an 18-year PPP agreement was signed between the government of Lesotho and the new company, Tšepong Consortium, for the construction and operation of the hospital. Netcare has a 40 percent stake in the Tšepong Consortium. Four other companies, namely, Afri'nnai of South Africa, Excel Health, Women Investment and D10 Investments (all from Lesotho), hold the balance of the shares.

However, the consortium has been under fire for allegedly fleecing the government and flouting the tenets of the agreement over the years. Its operations have also been hamstrung by ubiquitous staff strikes for salary increments since 2012.

Mr Sekatle said although the government and the consortium had differed over many issues, the final straw was the latter's weekend decision to fire 345 striking nurses and nursing assistants at the institution.

The nurses, who went on strike since 1 February 2021, began receiving their dismissal letters on Friday.

They went on strike to press the government and QMMH to award them salary increments to match their counterparts in other government and private institutions.

QMMH nurses said they have not been awarded any increments since 2012 when the government and the Christian Health Association of Lesotho (CHAL) increased the salaries of nurses at other institutions.

According to the Lesotho Nurses Association (LNA), nurses at QMMH earn about M9000 each per month. The figure is way less than the M13 000 earned by their colleagues in CHAL facilities and other government hospitals.

The nurses defiantly continued with their strike despite a 24 February 2021 interim Labour Court ruling by that court's president, Motlatsi Monoko, for them to return to work pending the finalisation of their dispute.

QMMH Public Relations Manager Mothepane Thahane had said the hospital would continue working with skeletal staff until after the nurses' posts were filled.

However, the dismissals of the nurses which only served to further cripple the ailing health sector already struggling to deal with Covid-19 infections, did not go down well with the government, forcing its unexpected decision to cut ties with the consortium.

Mr Sekatle said the government was particularly unhappy with fact that the QMMH management fired the nurses without first consulting or informing it.

He said following the dismissal of the nurses, a government sub-committee met on Tuesday and resolved that the government must sever ties with the consortium due to the "toxic nature" of the relationship.

"Today the government has instructed the Ministry of Health and the Ministry of Finance to cut ties between the government and the Tšepong Consortium," Mr Sekatle said.

"We are going to do this by following the legal procedures as it is only best to handle the matter lawfully to avoid further challenges.

"When the government entered into a Public Private Partnership agreement with the consortium in 2008, the expectation was that this would lead to the revival of the health system in the country. But this has not borne the desired results.

"What we thought was going to benefit our healthcare system has only brought many challenges from day one. Some of these problems have culminated in this dispute (over striking nurses)," Mr Sekatle said.

He said the two parties had over the years quarreled over many issues including the opening and operation of a private ward for patients.

"This (private) ward was established to admit (higher end) private patients who would pay more for services. Tšepong used it for their own gain as they admitted ordinary patients to make more money.

"The other bone of contention concerned the demands for salary increments by employees. The consortium refused to award increments to match those that had been awarded by the government in its other facilities and church-run institutions. They said we had to give them more money before they could award any increments. This despite that more than half the health ministry's annual budget goes to the consortium.

"This is the issue that has now caused the strike which led to the dismissal of nurses. These are just examples of the issues that explain our relationship with the consortium," Mr Sekatle said.

He subsequently told this publication that they had already informed the consortium of their intention to cut ties.

He said in terms of the PPP agreement, they were required to give a 20-day notice of their intention to cancel the agreement.

"To begin with, the PPP agreement was skewed in favour of the consortium. But we gave them notice this week of our intention to terminate our relationship. We now await their response and if there are any disagreements, we have to agree on an arbitrator. The issue could even end up in the courts of law. But this is a route we are prepared to take because there's no way we can continue with this arrangement when it is not benefitting the government and the nation," Mr Sekatle said last night.

Asked what would happen to the fired nurses, Mr Sekatle said they would return to work as soon as the "divorce" with the consortium was finalised.

"They will also receive the long-delayed salary increments because there is no reason why they continued being paid less than their counterparts in other health institutions," Mr Sekatle said.

He said the government would look to partner with local and other companies to ensure the hospital provided excellent service as the country's main referral institution.

Until then, the nurses would remain fired, he said.

Over the years, QMMH has experienced several challenges including infighting among the companies in the Tšepong Consortium. The infighting has even spilled into the courts with Netcare being accused by the other four companies of siphoning millions of maloti from the company under "dubious and unexplained circumstances".

QMMH is facing serious financial challenges which the other shareholders have blamed on Netcare's alleged financial impropriety which has allegedly seen it make making unauthorised payments to itself, its subsidiary, Botle Facilities Management and some unknown persons.

The companies made the accusations in response to Netcare's ultimately unsuccessful February 2020 application for the Tšepong Consortium to be placed under judicial management because it was allegedly insolvent.

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