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CONTROVERSIAL PROJECT

Unqualified firm supplied faulty medical kits - report

Senators say ministry exposed the government to potential risk of loss by admitting contractor who is not manufacturer.

In Summary

• The MoH contracted GE East Africa to supply MES equipment even though it was not qualified.

• The equipment supplied under Lot 7 has been reported to have had multiple faults.

President Uhuru Kenyatta and Deputy President William Ruto inspect medical equipment procured through the Managed Equipment Services (MES) Project at State House, Nairobi.
RISKED GOVERNMENT LOSS: President Uhuru Kenyatta and Deputy President William Ruto inspect medical equipment procured through the Managed Equipment Services (MES) Project at State House, Nairobi.
Image: PSCU

A Senate committee wants the anti-graft agency to investigate the circumstances under which an ‘unqualified’ firm was awarded a multi-billion shilling tender to supply medical equipment.

In addition, equipment supplied by GE East Africa Services Limited has been reported to have had multiple faults and breakdowns.

In a report, the nine-member ad hoc committee established that the company was not an original equipment manufacturer, as required in the contract.

 

The committee chaired by Isiolo Senator Fatuma Dullo noted that the tender document issued by the Ministry of Health invited only original manufacturers of medical equipment to bid under the MES project.

Despite not being an original manufacturer, GE East Africa Services Limited was awarded the tender to supply Lot 7 (radiology) equipment vide an award letter dated November 21, 2014.

“The ministry, therefore, illegally awarded the contract as it failed to adhere to its own tender requirements for original equipment manufacturer (OEMs),” the report reads.

“The ministry violated the Public Procurement and Disposal Act that states that procuring entities shall reject all tenders which are not responsive in accordance with the Public Procurement and Disposal Regulations, 2006,” it adds.

Moreover, in allowing a party that was not qualified for the tender nor an original equipment manufacturer for the machinery being purchased, the senators observed that the ministry exposed the government to potential risk of loss.

“Kenyan law holds that subsidiary companies are separate entities from their parent companies therefore any liabilities falling on the subsidiary will not be borne by the parent company,” they held.

In addition, the GE East Africa, which got the lion's share of the MES contracts, was already negotiating with the ministry to lease/place equipment in the public health facilities before the Medical Equipment Services project.

 

However, the equipment supplied under Lot 7 has been reported to have had multiple faults.

According to the MES Service Level Monitoring Final Quarterly Report (January, 2019) by PKF Kenya, out of all the MES equipment, radiology equipment had logged the highest number of equipment breakdowns with a total of 550 faults reported in 2017, and 663 in 2018.

"Of these, the most affected equipment were digital general X-ray machines, ultrasound units, and mobile X-ray units,” the report states.

According to them, this is an indication that the maintenance costs of the equipment may be high and, therefore, result in increased costs of the contract relating to Lot 7.

According to documentation received from the ministry, the committee disclosed that digital general X-ray machines were installed but non-functional in 16 hospitals including Bondo, Chebiemit, Garbatulla, Garsen, Gucha, Kacheliba and Kapenguria.

Others were Kehancha, Keroka, Likoni, Makindu, Mwingi, Ndanai, Nyambene, Tharaka and Endebess hospitals.

Furthermore, during the committee’s site visit to Garba Tulla SubDistrict Hospital in Isiolo county, the general X-Ray machine was found only partially installed with parts of it lying on the floor of the radiology department in its original polythene packaging.

In addition, the ultrasound machine and C-Arm and mobile X-ray units were evidently not in use and still in their original packaging. 

Edited by R.Wamochie