The SADMON files 1: Government pushed R352m to controversial communications company

By Anneliese King

In 2015 Johannesburg-based company, Sadmon Projects and Consulting was awarded a three year, R352 million tender to handle the Department of Health’s “mass media communication and social media mobilisation campaign” relating to HIV & AIDS, Tuberculosis and maternal child & women’s health, as well as the promotion of healthy lifestyles.

The award of the tender raised eyebrows in the AIDS world specifically, as Sadmon had a record of snagging juicy health communication tenders, but producing less than stellar results.

In 2017 Spotlight lodged an application for all documentation relating to the tender via the Promotion of Access to Information Act (PAIA). The aim was to understand how the bid was granted, what monies were paid to the company and what was delivered in return. While we did not receive all the documents requested, we did receive hundreds of pages of fascinating information usually not in the public domain.

Our five-part investigation (this is part 1) provides an unprecedented perspective on one of South Africa’s most critical communication projects, and a unique insight into the interface between a service provider and government. It is not a pretty picture. While there are some moderate successes over the 36-month contract period and no evidence of corruption, there is an undercurrent of wasteful expenditure and lack of communication. Sign-offs and approvals take months to wind through the system and there’s a constant chopping and changing of priorities. Above all, there seems to be no governance or oversight structure to efficiently manage delivery on the contract. Sadmon’s 36-month contract came to an end at the end of October. It is not clear whether the Department will issue a new tender for an external service provider.

 A history of controversy

By the time the National Department of Health awarded Sadmon Projects and Consulting the mega communications tender in 2015, the company and its Managing Director, Cyril Sadiki, had already been at the helm of a string of communication projects in the public healthcare sector.

Sadiki’s CV states that he is “a social marketer par excellence” and that he was “headhunted” by Johnnic Communications in 2004 to project-lead SA’s flagship HIV/AIDS behaviour change campaign, Khomanani.  The campaign expired in July 2006 when the then Director General of Health called for a review of activities and then issued a new tender.

It was in this interregnum, it seems, that Cyril Sadiki established Sadmon before assembling a new consortium (KCC) that was awarded the R190 million Khomanani tender in May 2007. Sadiki became the overall Programme Manager, and his company took on the “pivotal role of project managing and providing client service”.  When the two-year tender ran out, KCC was reportedly given an extension of nine months, reportedly earning a further R130 million.

In 2010 the whispers and rumours in the health world about the poor delivery of the campaign burst into the open in a range of explosive media reports calling for a forensic audit into Khomanani.

It was revealed at the time that, in the run-up to World AIDS Day in 2009, The South African National AIDS Council’s (SANAC) Technical Task Team for Communication sent a letter to the Health Department warning that the AIDS Day event could “severely embarrass” the President and Health Minister. They requested SANAC be given responsibility for the World AIDS Day event and the HIV counselling and testing campaign.

Sadiki’s response was to double down against SANAC. He requested the Health Department to observe the contractual agreement “thereby protecting us from dealing with the (SANAC) Secretariat.”  It was a mystifying – and deeply problematic – position to adopt considering that SANAC is a government entity with the express mandate to “lead South Africa’s response to the national HIV, TB & STIs epidemics”.

After World AIDS Day, SANAC again wrote to the Department expressing their unhappiness with how the event had been handled. They asked for formal reports on the costs and reach of World AIDS Day and also raised concern about “large fees” paid to strategic advisors and companies in the consortium. In a December 2010 article by Health-e News Service, then Deputy Chairperson of SANAC Mark Heywood, said R90 million of the Khomanani budget had not been spent and that there had been “a virtually invisible campaign in the run-up to World AIDS Day”.

A 2010 report published in the Natal Witness revealed that KCC was charging over R2 million a month for “administration and management” and R2.5 million for strategic advice to the Health Department, although  “no one seems to know what advice is being given”. The report further said the campaign was “characterised by incompetence and nepotism, with little attempt to measure its impact”.

Asked whether the above allegations were ever investigated, the National Department of Health recently told Spotlight they were “never provided with any information that necessitated the need to conduct forensic investigations into the finances and contracts. All Department’s finances are audited.”

Despite the various media reports and actions taken by SANAC cited above, the department insists that “there is no information to support the view that the campaigns were controversial and characterised by shambles”.  “The information at our disposal is that Sadmon was part of the Consortium that implemented Khomanani. Sadmon bided openly like other companies in 2015. In our view, it was on the strength of their offering that they were awarded the tender,” the department told Spotlight.

How effective was Khomanani?

The nub of the criticism from AIDS activists and health NGO’s against the Khomanani campaign was that despite the millions paid it was ineffective and not delivering on its primary mandate – to change behaviour through effective communication to, amongst other objectives, arrest the spread of HIV and TB. Khomanani was to play a critical role in the implementation of the National Strategic Plan for HIV and AIDS and with the epidemic raging among key and vulnerable populations a targeted, well-run and well informed communications campaign was critical and potentially lifesaving.

While the Department of Health seemed happy enough with Sadmon to continue using them in other campaigns, most of the available evidence does not paint a good picture of Komanani’s performance.

If the findings of the 2015 Millennium Development Goals (MDG) Country Report are anything to go by, Khomanani communication had very little impact. By 2012, the MDG Country Report found (eight years after the start of the Khomanani campaign) that the proportion of the population aged 15-24 with comprehensive and correct knowledge of HIV/AIDS had dropped massively from 56% in 2002 to 24,2% in 2012.

In 2009, a Human Sciences Research Council (HSRC) report found that there was an increase in the population reached by at least one national HIV communication programme between 2005 and 2008. The report however found that “although reach of the main national HIV/AIDS communication programmes increased over time, the government’s Khomanani Programme had the lowest reach in comparison to other programmes”.

“Khomanani Communication Consortium (KCC), which was Sizwe Ntsaluba led with advertising luminaries TBWA hunt Lascaris, Sadmon and Izwi Multimedia, did a great job on Khomanani,” says Sadiki when asked about the allegedly poor work done on Komonani. “Sadmon was the project management and social marketing consortium member, not the sole operator of the campaign.”

Sadiki brushes aside the HSRC findings. “Regardless of certain people turning HSRC ‘08 results and utilize them to further their ulterior motives, we were proud that we were able to move Khomanani reach from 38.4% (in 2006 when some of accusers were part of Khomanani 1) to 56.8% (in 2008 when KCC was in charge) with even a greater increased reach amongst younger audience (-24yrs),” says Sadiki.

He also points out that a TNS survey and a National Communications Survey were much more positive about Sadmon’s work and that Sadmon one a Loerie award for some of their HIV-related work.

 Sadmon scores again in 2015

Despite all of the above, the Department of Health handed Sadmon another mega deal in May 2015. Tender 31/2014-2015 called for “a service provider to conceptualise; manage; coordinate and implement a multi-pronged mass media communication and social media mobilisation campaign on the following areas: HIV & AIDS; TB; Maternal Child and Women’s Health and promotion of Healthy Lifestyles.

Five companies made the shortlist and were invited to make presentations to the Bid Adjudication Committee. The annexure listing the names of the Bid Adjudication Committee was missing from the documents provided to us by the Department, but records show long-time Deputy Director-General, Dr Yogan Pillay, chaired it.

Score sheets show that Sadmon scored third both on functionality and for their presentation, meaning that in these rounds, the Committee deemed two other companies better. Sadmon was awarded the tender based on their BBBEE status and their costing. According to Companies and Intellectual Property Commission records Sadiki is both the sole director and sole owner of the company. Sadmon quoted R352, 728,389.52, which was about R3.5 million cheaper than the next nearest bidder.

It is worth noting the tender’s opaque terms of reference. The companies were required to provide costings for broad, open-ended categories like Advocacy, Public Relations and Events Management, Stakeholder Engagement, Monitoring and Evaluation and the management of the Department’s Red Ribbon Warehouse (a warehouse which keeps all publications, pamphlets, condoms, etc), as well as Account Management, Client Service and Overall Administration. The requirements for each category were not specified leading to wildly different costings from the various bidders.

The financial documents provided to Spotlight by the Department as result of the PAIA requests, were sketchy. No invoices or billable hour reports were submitted. The bulk of the papers were Sadmon’s monthly activity reports (some in duplicate), as well as contractual documents. In between these, we found two pieces of useful financial information – a list of invoice amounts raised by Sadmon, and a payment report showing all monies paid to Sadmon between January 2014 and March 2018.

Curiously, the department refused to provide Spotlight with actual invoices after this was expressly requested in a revised PAIA request. When we again asked to see the invoices in question we sent the department in October 2018, our request was rejected. The department said that “giving members of the media invoices will mean a form of irregular audit which department cannot engage in”.

When all the PAIA’d documents are viewed holistically, we are able to deduce the following:

A Letter of Acceptance was issued to Sadmon in September 2015 for their bid. The letter stipulated that no services could commence before a Service Level Agreement (SLA) was signed – this took place in November 2015.

Three SLA’s were signed over the 36-month period – one for the remainder of the 2015 financial year, and then two for each subsequent fiscal year. From the invoicing list we know that by August 2017 – 27 months into its 36-month contract – Sadmon had already invoiced for almost R241million.

As an aside, it appears that Sadmon has also been doing work on Eskom’s Operation Khanyisa campaign although Eskom itself seems unaware of this. “Sadmon Projects and Consulting is not registered in Eskom Database. Eskom does not have a record of contracting the company for any services,” Eskom’s media desk told Spotlight. Sadiki explained to Spotlight that Sadmon had been subcontracted to do this work – first by Magna Carta and later by Global Interface. For Eskom not to be aware of which sub-contractors are being used on their campaigns is unusual.

Women on top

Having secured government’s top health communications contract in 2015, Sadmon again courted controversy in September 2017 with billboards that read “Who says girls don’t want to be on top”. Both Yogan Pillay, Deputy Director at the Department of Health, and Sadiki argued in the media that the billboards were not sexual and that there was no sexual innuendo. In an interview on SAfm radio Sadiki went as far as to suggest that people who were reading sexual innuendo into the billboards were incorrect. That Sadmon did not anticipate the controversy and that they then argued that people were misinterpreting the billboard raises serious questions about their communications expertise.

The documents obtained through the PAIA show that Sadmon had suggested other wording for the campaign that may have been even more controversial. These include “G-STRING (Girl String) and SLUTT (So Let’s Unite Together).

An R24 million snapshot in time

While the billboards made the headlines, most of Sadmon’s multimillion Rand work since 2015 seems to have gone widely unnoticed. By June/July 2017, Sadmon’s 36-month contract with the department had reached its mid-way mark. Sadmon invoiced the Department just over R24 million for services rendered in these two months. The only billable hours’ record for the entire time also pops up in the voluminous July report, and we, therefore, selected this two-month period as a dipstick period for an analysis of what was delivered by Sadmon.

Sadmon’s reporting to the Department of Health follows the familiar pattern established over the prior eighteen months. Pages of long-winded formulation often padded with incidental information, events often repeated and activities restated. The actual deliverables are difficult to extract from what seems like a deliberately convoluted reporting format. The “narrative” reporting style preferred by Sadmon is different to the standard consulting practice where a succinct list of deliverables, with supporting samples of all work produced, is usually submitted.

The June report is 82 pages long, but the actual hard deliverables come to only eight.

In this period Sadmon invoiced around R7,3 million for rendering services relating to the South African National AIDS Conference in Durban. The primary deliverable is the exhibition stand for the AIDS Conference. The design and building of the exhibition stand is listed as a deliverable in the previous month, so the main focus is on activating the installation  – and staffing it during the conference. Sixteen Sadmon staffers are deployed to Durban to do this.

The report states that the “state-of-the-art” stand was a “show stopper that stole the attention of most delegates with its captive (sic) design and daily activities communicating key goals of the newly launched NSP policy”.

A crucial part of Sadmon’s role at the conference was to “handle all media-related activities and content management thereof” but this side seems to have gone awry. The opening of the stand, accompanied by a book launch, was attended by only three media outlets – EWN, the SABC and Daily Mail, and Sadmon’s deliverable report makes no bones about the fact that it did not manage to generate any quality in-depth coverage – although they blame the conference organisers for this.

“After circulating the motivation to key producers and News Editors at various radio stations, we discovered that they were not aware of the SA AIDS conference and had already scheduled content for their station’s health shows. This was due to the lack of PR executed by the conference organisers,” the monthly report states. It goes on to outline how five media statements were drafted for the conference but were not issued because there was “no feedback or approval” from the client (NDoH). They admit that this “meant we could not share any information with the media outside the conference or those who did not attend the sessions, making it impossible for us to give the kind of coverage required for such an event”.

The PR fail is baffling considering that three PR practitioners and two digital media specialists were part of the 16-member conference support team. Sadmon also speaks of its three-phase PR plan with “pre, during and post” conference activities. How this did not include pre-conference media mobilisation, which would have meant creating awareness of the conference itself, is not explained.

Despite the self-confessed shortcomings of its PR strategy, Sadmon still claims media coverage “worth over R1.5 million”. It is not clear how much of this is simply claiming credit for general news coverage of the conference generated by the large contingent of journalists who attended of their own accord.

 This is part 1 of a five-part series investigating the Department of Health’s R352 million contract with Sadmon.

 Note: We have not edited Mr Sadiki’s comments for grammar or spelling given that he heads a major communications company.

 While Spotlight is published by SECTION27 and the Treatment Action Campaign, its editors have full editorial independence – independence that the editors guard jealously. Spotlight is a member of the South African Press Council.

One Reply to “The SADMON files 1: Government pushed R352m to controversial communications company”

  1. Well done for doing this investigation. In a country where we desperately need good communication it is tragic that this money is wasted. The recent tender for SANAC communications was cancelled. Is this related?

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