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Auditor General faults medical equipment lease

By Hillary Mageka
Wednesday, October 9th, 2019
CoG chair and Kakamega Governor Wycliffe Oparanya has been strongly critical of the medical scheme. Photo/PD/BERNARD MALONZA

Details have emerged of how the Ministry of Health officials hatched a plot to drain public funds through the procurement of the controversial Sh63 billion Managed Equipment Services (MES) programme.

A special audit on the MES scheme has exposed how top officials manipulated procurement laws, varied contracts and finally coerced county governments into accepting the equipment.

According to the Auditor General, the leasing of medical equipment to the 47 county governments initially brought on board as Public-Private Partnership (PPP), to scale-up investment in health infrastructure was changed to suit the regulations under the Public Procurement and Asset Disposal Act (PPDA 2005).

The health policy provided for PPP as a form of financing health projects, the auditors affirmed.

Data presented to a Senate ad hoc committee investigating the quarrelsome MES programme on Tuesday revealed that ministry officials allegedly exploited a loophole in the Act that allows an entity to procure the good and services through restricted tendering.

In addition, the auditors said, they identified cases of non-compliance with Public Procurement and Disposal Act 2005 and regulations of 2006 that expose the “programme to risks of failure to realise value for money.” 

The MES concept paper indicated that the programme was to be implemented through long-term lease arrangements for medical equipment in accordance with the PPP Act, 2013 based on the “Build lease-and-transfer model” 

“A report by PPP unit of October 2014, outlined that the project of equipping health facilities in Kenya had been approved by PPP Unit to be implemented as a PPP by the Ministry of Health,” the auditor report read in part.

“The MoH adopted the Managed Equipment Services (MES) model which required for the outsourcing of all aspects of medical equipment to third party companies that specialises in providing the type of service required,” it adds.

The report now indicts the Cabinet Secretary Sicily Kariuki-led ministry for abandoning the PPP—the established form of financing the projects—and sidelining the counties in carrying out needs assessment and employing restricted tendering in procuring consultants for the project.

A Nairobi court has allowed the Director of Public Prosecutions to adduce new evidence in the National Youth Service (NYS) corruption case.  

Milimani chief magistrate Douglas Ogoti directed DPP to serve former Youth Affairs PS Lilian Omollo and 31 others charged with the loss of Sh226 million at NYS with the additional documentary evidence within three days. He gave the accused persons 14 days to prepare for their defence.

The documents include issue notes, counter books and receipts.  The directive follows an application by the DPP on July 29.

Lawyer Stephen Ligunya, for Omollo, had objected the application, arguing the prosecution ought to have disclosed all documents during pre-trial.

Omollo is charged alongside former NYS director-general Richard Ndubai, other former public officials and businesspeople Lucy Ngirita, Ann Ngirita, Phyllis Ngirita and Jeremiah Ngirita. The case will be mentioned on October 23.