DA Alleges Secret Settlement for Former Gauteng Health CFO Linked to Tembisa Hospital Scandal
Viable News Team 
The Democratic Alliance (DA) says it has uncovered new details about the departure of former Gauteng Department of Health Chief Financial Officer Lerato Madyo, who had been facing disciplinary charges linked to controversial contracts at Tembisa Provincial Tertiary Hospital.
According to the DA, Madyo did not resign from her position as previously reported by the department in 2024. Instead, the party alleges she left after receiving a confidential settlement agreement while disciplinary proceedings were still underway.
Settlement Agreement Revealed
The information emerged from a written reply by Nomantu Nkomo-Ralehoko to questions submitted in the Gauteng Provincial Legislature.
In the reply, Nkomo-Ralehoko confirmed that Madyo left the department on 31 July 2024 after both parties reached a settlement agreement.
However, the MEC indicated that the terms of the settlement – including any financial payment – cannot be disclosed due to a confidentiality clause signed by both parties.
The agreement was reportedly authorised by the department’s accounting officer, while the office of Panyaza Lesufi was informed of the decision.
Link to Tembisa Hospital Corruption Allegations
Madyo had faced disciplinary charges relating to alleged irregular contracts worth hundreds of millions of rand at Tembisa Hospital, first flagged by murdered whistleblower Babita Deokaran.
Deokaran, a senior finance official in the Gauteng Health Department, was assassinated outside her Johannesburg home in August 2021 after raising concerns about suspicious payments linked to hospital procurement contracts.
Investigations later revealed that more than R850 million in contracts at Tembisa Hospital had been flagged as potentially irregular, with broader allegations suggesting that over R2 billion may have been looted through corrupt procurement networks.
Allegations of a “Hush Settlement”
The DA claims Madyo had initially frozen R104 million in payments flagged by Deokaran but later allowed them to proceed.
The party further alleges that Deokaran had warned Madyo shortly before her death that exposing the irregular contracts could place their lives in danger.
Madyo was reportedly suspended with pay for nearly two years while the department pursued disciplinary proceedings involving 13 misconduct charges.
However, the DA argues the process was never completed, allowing her to exit the department with pension benefits and an undisclosed settlement payment.
Criminal Charges and Legal Questions
In October 2025, the DA laid criminal charges against Madyo, alleging violations of:
- The Prevention and Combating of Corrupt Activities Act (PRECCA)
- The Public Finance Management Act (PFMA)
- The Criminal Procedure Act
The party says legal advice suggests the settlement agreement could be challenged in court if it involved public funds used to resolve alleged misconduct without proper accountability.
Under the PFMA, accounting officers are required to prevent irregular, fruitless or wasteful expenditure involving state resources.
Calls for Transparency
The DA says it will pursue several steps to obtain full disclosure of the agreement, including:
- Requesting the Ezra Letsoalo to secure the settlement documents through the Legislature’s oversight process.
- Filing a request under the Promotion of Access to Information Act (PAIA).
- Submitting additional questions to the MEC for Health and the Gauteng Premier regarding the legality of the payout.
The party also called on acting department leadership, including Darion Barclay, to investigate whether the agreement violated financial governance laws.
Ongoing Fallout From Deokaran’s Murder
The killing of Babita Deokaran remains one of South Africa’s most high-profile whistleblower murders and continues to raise concerns about corruption within public procurement systems.
Several suspects linked to the assassination have been arrested in recent years, while investigations into the financial networks connected to the Tembisa Hospital contracts remain ongoing.
The DA says it will continue pushing for accountability in both the corruption allegations and the whistleblower’s killing.
Source: Statement by the Democratic Alliance
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