The Eastern Cape health department on Thursday dismissed allegations by the Treatment Action Campaign (TAC) and Section 27 that the province's health system was collapsing.
"We have studied the report and it is full of deliberate distortions," said the department's spokesman Sizwe Kupelo.
The TAC and Section 27 released a detailed report on the health system in the Eastern Cape, on Wednesday.
Kupelo said the report lied by presenting the public with old problems that had been resolved, particularly the drugs shortage issue.
Drug issue addressed
"The issue of drugs was addressed," he said.
Kupelo denied allegations that the province had a high staff vacancy rate.
He said the department continued producing nurses through its internal nursing college, and doctors were deployed where they were needed. The report described hampered service delivery as a result of the poor state of health care facilities.
Six hospitals were being demolished to be rebuilt in the Transkei, Kupelo said.
"We are building a gateway clinic at the cost of R38 million in Madwaleni near Elliotdale."
Over 50 officials who were found guilty of corruption were fired last year.
He said a list of officials doing business with the department had been handed over to the Treasury for investigation.
In the report, the organisations identified mismanagement of funds as an underlying problem.
In 2011/2012, the department overspent on its staffing budget by more than R1 billion because of higher than inflation increase to salaries and poorly-managed employee benefits.