The anti-corruption commission is investigating a possible misappropriation of up to Sh6 billion through inflation of prices for goods and services relating to the Covid-19 pandemic by well connected individuals at the government medical supplies agenc.
On Tuesday, Ethics and Anti-Corruption Commission (EACC) detectives raided the Kenya Medical Supplies Authority (Kemsa) offices twice after Chief Executive Officer Jonah Manjari Mwangi failed to furnish them with 15 sets of documents deemed key in an investigation involving several cases against the agency.
Kenya Medical Practitioners and Dentists Union (KMPDU) acting secretary general Chibanzi Mwachonda reiterated yesterday that healthcare workers were being supplied with sub-standard face masks and Personal Protective Equipment (PPEs) which have been rejected by medics at the Kenyatta National Hospital because of defects.
Doctors and nurses at the facility are each allocated 10 masks every week, according to a health worker who sought anonymity for fear of reprisals from her superiors. The procurement of the substandard equipment is now being directly linked to the rising cases of Covid-19 infections among healthcare workers in Kenyan public hospitals.
“The union has voiced concern over sub- standard PPEs being used by health workers in the country. Our concerns point out to the possibility the PPEs could be contributing to the increased infections among frontline healthcare workers with the latest figures showing that 93 of them have been infected,” said Mwachonda.
Documents seen by the PD detail how Kemsa procured the equipment from a pool of suppliers who were handpicked by the management without due diligence, prompting Health Principal Secretary Susan Mochache to intervene. The PS, in a letter dated May 22, and copied to Kemsa CEO Manjari, sought an audit of the commodities procured by the authority under the Contingency Emergency Response component. “We are aware that procurements were made on behalf of the Ministry of Health relating to Covid-19 and have been marked for payment using the World Bank funds.
We are sending the internal audit team to visit Kemsa from May 26 to May 29, and ascertain the following: “Description of all items procured, including name and quantities, cost and procurement method used, dates when contracts were signed, delivery schedules and verifica- tion of the procured items,” wrote Mochache.
The authority failed to produce any of the documents apart from a list of companies which supplied masks (N95) and PPEs, all valued at Sh758.6 million. In his response to Mochache’s letter, Manjari wrote; “We confirm that we have issued letters of commitment for procurement of the items to suppliers worth Sh 58,690,583 as detailed in your letter.
The successful companies sup- plied masks at outrageous prices which could not be explained and are now the subject of investigation by the anti graft agency. For instance, while one firm, MEDS Limited, supplied N95 masks at a cost of Sh250, Shil Trading and Logistics Ltd sold the same at Sh900. Other companies including Biroyal International Ltd and Encartar Diagnostics Ltd sold theirs at Sh700 per piece. The same type of masks cost between Sh350 and Sh450 in the local market.
Two firms, Tikasan Holdings Co Ltd and Faram (EA) Ltd, supplied Kemsa with PPEs at Sh9,500 per unit. The open market value is Sh5,000 per unit. The EACC has also launched investiga- tions into claims of exaggeration of price of items in the Local Purchase Order (LPOs) for most products and corruption in the con- struction of a Sh3.2 billion warehouse for the parastatal. The cost of the warehouse has since gone up to Sh4.5 billion and EACC wants the man- agement to explain the variation in the cost. Treasury has in the Supplementary Bud- get 3 asked Parliament to allow it to spend Sh262 million to pay for contractors for the warehouse. The warehouse construction is being funded by the Global Fund, Kemsa and the government. It is expected to be custom made for medical supplies storage.
The anti-graft agency chief executive Twalib Mbarak had on June 18, 2020 written to Dr Manjari, seeking to have tender advertising notices, bank tender documents, all bids submitted by the bidders, tender opening minutes, list of bidders and individual tender evaluation score sheets. Detectives had also requested for due dili- gence reports, professional opinion, tender award notifications and regrets, acceptance letters from the winning bidders, contract agreements, inspection and acceptance certificates, payment vouchers and appoint- ment letters to committees. “This commission is conducting inves-tigations into allegations of procurement irregularities at Kemsa in relation to tender KEMSA/CONST/OIT4/2019/20.
To facilitate our investigations, kindly furnish us with the original documents relating to the above tender,” Mbarak wrote. Dr Manjari, however, failed to furnish the EACC with the documents, plus the conflict of interest register maintained by the agency since January 2018, prompting Tuesday’s raid by detectives.
The investigators raided the offices of the CEO, head of Legal and head of procurement where they took away some documents. The detectives, accompanied by armed police of- ficers, spent almost two hours with the CEO at the offices in Industrial Area before leaving.
The EACC seeks to establish claims that some staff at the agency were involved in a conflict of interest where some senior man- agers have been doing business with the entity. The graft agency has also received com- plaints that some staff collude with suppliers to swindle public funds and that the organ- isation is technically insolvent because of mismanagement.
In one of the cases cited, the Mission for Essence Drugs (MEDS) supplied some products at a unit price of Sh298 yet the contract has an agreed price of Sh207 per unit. Some suppliers have also claimed that some staff openly solicit bribes and that in some cases, direct procurement is used to award contracts to friendly suppliers, who are willing to part with kickbacks.
The construction of the warehouse in Embakasi is also being investigated by the National Assembly. The agency is currently using a leased warehouse and the construc- tion is expected to save the agency millions of shillings in rent. The agency currently serves 371 hospitals, 4,415 rural health facilities and 5,047 sites that offer rapid testing across Kenya.
It also offers procurement, warehousing and distribution services for medical com- modities for other clients such as USAid, the World Bank and the Global Fund. Before his appointment to KEMSA, Manjari was the Nakuru County minister for health.
Source credits: PD