Tšepong downsizes services and begins QMMH handover process
THE TŠEPONG Consortium has started scaling down operations at Queen Mamohato Memorial Hospital (QMMH) and begun processes to hand over the hospital to the government.
In a statement yesterday, Netcare, the biggest company in the Consortium, said it had started the process of handing over QMMH and its four primary care clinics in Maseru to the Lesotho government.
“This is as a result of the public private partnership (PPP) agreement being prematurely terminated with effect from 31 August 2021,” Netcare said.
“The handover has been brought forward, however, following the ongoing non-payment of fees due to Tšepong by the Government of Lesotho (GoL).
“The decision to commence the handover of the facilities and operations follows the repeated failure by the GoL to settle the arrear payments for services rendered by Tšepong. The GoL has been persistent in demanding that Netcare, as the sub-contractor, continue to provide full services until 31 August 2021, notwithstanding that it is currently four months in arrears and is now into the fifth month of unpaid contractual monthly fees.
“In its capacity as a shareholder of Tšepong, and as the major provider of services to Tšepong, Netcare has continued to act in good faith and provided ample written notice to Tšepong and the GoL, as well as follow-up reminders that GoL is substantially in default of its payment obligations under the PPP agreement. The GoL has repeatedly reiterated that it has no intention of making these scheduled, contractual payments at this stage, and will only consider making payment after the PPP termination date of 31 August 2021.
“In light of these circumstances, Netcare is no longer prepared to fund ongoing operations on behalf of the PPP. Netcare has provided financial support on numerous occasions over recent years to enable continued operations at the hospital and primary care clinics when the GoL failed to make timely payment for services. The refusal by the GoL to pay the outstanding fees clearly places an unreasonable expectation on suppliers to continue providing full services at a substantial level of commercial risk to their businesses,” Netcare added.
It said it will downsize its operations and only attend to emergency cases and offer outpatient services to critically ill patients.
“The hospital will accept all urgent cases and emergencies, including obstetric emergencies, and outpatient services will remain available for any unstable patients. All other patients will be referred to government clinics and facilities,” Netcare said.
Tšepong’s General Manger, Zondi Mohapi, had in 12 July 2021 memorandum, indicated that the government owes Tšepong five months unitary fees from March to the present day.
“The government is currently in the four months of areas and already in the fifth month of unpaid unitary monthly fees due to Tšepong. On 7 July 2021, government advised us once again that if will not make payments of these outstanding fees owed to Tšepong until after the termination date despite the fact that services have been rendered.
“The impact of non-payment of these unitary fees on Tšepong’s ability to function is enormous. Hence Tšepong, through Netcare, advised government that it is no longer able to sustain the project because the contractual payments that are withheld by government are absolutely critical to maintain services and paying salaries,” Ms Mohapi said.
Health Minister Semano Sekatle said they were prepared to take over the hospital once the Consortium packs its bags.
However, there are fears that the Consortium’s premature and abrupt departure will plunge the hospital into uncertainty as there are concerns among the staff as to whether the government has the capacity to take over the running of the hospital.
It follows the government’s March 2021 decision to cut ties with the Consortium which has run QMMH since it opened its doors in 2011.
Announcing the decision, Mr Sekatle said the government felt it could no longer continue its 18-year 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, 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.
Mr Sekatle had said although the government and the consortium had differed over many issues, the final straw was the latter’s March 2021 decision to fire 200 striking nurses and nursing assistants at the institution.
The nurses went on strike on 1 February 2021 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 had 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.
After the firing of the nurses, Health ministry Principal Secretary (PS) Khothatso Tšooana had written to the Consortium informing it of the government’s decision to terminate the contract.
In his 12 April 2021 reply to PS Tšooana, Tšepong general manager Zondy Mohapi indicated that the Consortium would not challenge the termination of its contract would demand the requisite compensation.
However, the Consortium vehemently denied any wrongdoing, including claims that it had fleeced the government and repeatedly failed to offer specialised care to patients over the years.
The Consortium agreed to vacate the hospital but said the government would have to compensate it for the premature termination of the 18-year PPP deal.
It said the government would have to fork out way more than just the M3 billion which Finance Minister Thabo Sophonea has said is the termination fee. The Consortium alleges the government owes other sums in unpaid fees hence the demand for much more than just the termination fee. However, it does not say how much the government should pay. It merely says the amount is disputed by the government.