No deals signed in MES project, Senate team told
There are no contractual agreements between the government and suppliers of medical equipment in the Managed Equipment Services (MES) programme, the office of the Auditor General told a Senate committee yesterday.
Deputy director in-charge of special audit Sammy Kimunguri told the Senate ad-hoc committee investigating the programme that the Health ministry included 24 more health facilities to the 98 which were in the initial deal.
However, no documents to support the contractual agreements for the 24 facilities not even a catalogue, were provided.
Further, the committee heard that some of the health facilities auditors visited did not have the equipment although the respective counties continued to pay for them.
“In some of the facilities we visited for the purposes of audit, we did not find the equipment,” said Kimunguri. “During our visit to the facilities we could not physically confirm if the equipment were supplied.”
It also emerged that suppliers who delivered the equipment had not been paid although the National Treasury continued to deduct money from the counties.
Kimunguri said in the deal which was signed in 2015, the suppliers were to be paid Sh95.7 million annually for a fixed term of seven years to provide medical equipment.
He said the payments were varied from Sh95 million to Sh200 million under unclear circumstances.
He further told the committee, chaired by senators Moses Wetang’ula and Fatuma Dullo, that it was the conclusion of the Auditor General that the project is not sustainable and needs to be reviewed.
Wetang’ula, (Bungoma), sought to know why the auditors chose to sample the counties to be audited whereas the law is clear that all the entities that benefit from public funds are inspected.
“Is sampling a way of doing auditing? I thought the law is clear that each entity that benefited from taxpayer’s money must be audited,” said Wetang’ula.
“We opted to sample the facilities since the supply of equipment was not uniform. Different health facilities received different equipment,” Kimunguri said in response.
Auditors from the office of the Auditor General told the Senate committee that Ministry of Health officials manipulated procurement laws, varied contracts and forced county governments into accepting the equipment without proper consultation between them and the ministry.
“The ministry officials were in blatant violation of the Public Procurement and Asset Disposal Act,” Kimunguri told the members.
The committee heard that in the model applied, all medical equipment were outsourced from third party companies.
The contract involved leasing renal, laboratory, ICU, radiology and theatre equipment.
At least two hospitals in each of the 47 counties benefited from the equipment during its commencement.
The contract between the ministry and the counties included setting up the facilities to house the equipment, installation and training of technical staff to operate the equipment.
Among the companies that supplied the medical equipment were M/S General Electric East Africa Services which supplied radiology equipment worth Sh23.8 billion, M/S Esteem Industries Inc which supplied theatre, equipment worth Sh8.8 billion, and M/S Shenchem Mindary Biochemical Electronic Company which supplied other theatre equipment worth Sh4.5 billion.
Other firms included M/S Philips Medical Systems which supplied ICU equipment worth Sh3.6 billion, M/S Sysmex Eorope GMBH which supplied laboratory equipment worth Sh2.9 billion and M/S Bellco Ltd which supplied renal equipment worth Sh2.3 billion to the counties.
The ministry officials, the auditors observed, abandoned the initial Public Private Partnership (PPP), which was the established form of financing medical projects.
In total, devolved units have paid Sh29.1 billion despite the equipment lying idle in hospitals.