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Sh7.6b Kemsa deal was a matter of life and death, House team told

By Mercy Mwai
Wednesday, December 2nd, 2020
Suspended KEMSA commercial services director Eliud Muriithi.
In summary

Kenya Medical Supply Authority (Kemsa) top managers yesterday made sensational claims how suspended chief executive Jonah Manjari single-handedly awarded Covid-19 related tenders worth Sh2.3 billion to eight companies without approval of the Procurement department.

At a grilling session where Nairobi Senator Johnson Sakaja’s name featured prominently, Members of Parliament heard how Manjari allegedly threatened, coerced and pushed the managers to pave way for the issuing of commitment letters which he signed in his office despite being advised to stop further procurement of Covid-19 related items due to lack of funds.

Suspended Procurement director Charles Juma and Commercial director Eliud Muriithi told MPs that Manjari had on several occasions, after meeting with some powerful people in government, told them to proceed with the tenders, despite them advising to him to stop further purchase as the cost had shot to Sh7.6 billion against a budget of Sh4.5 billion.

“The CEO at one time informed me he was under so much pressure. Every time I told him that we had overshot the budget and we ought to stop further purchases, he told me ‘Mr Juma you don’t know what I am going through and what I am dealing with’,” he said.

Undue influence

“I was coerced by the CEO to write some of these commitment letters, I went to his office to warn him about the situation we were in after he came out of a meeting with influential people and that is when he told me, ‘I am the accounting officer and I am the one who will sign these letters, you don’t know who I am dealing with as these people have the powers to make you disappear’. I felt this was a threat to my life.”

Juma added: “To date, I still feel threatened because there are a number of commitment letters that I never agreed to sign.”

Manjari, Juma and Muriithi are on suspension to pave way for a probe into Covid-19 procurement by the state agency.

Apart from Parliament, the three are also facing another investigation by the Ethics and Anti-Corruption Commission.

The National’s Assembly Public Investments Committee (PIC) chaired by Mvita MP Abdulswammad Nassir is investigating the Sh 7.6 billion Kemsa scandal  after a special audit report on Covid 19 funds conducted by Auditor General Nancy Gathungu revealed there was huge misappropriation of funds at the authority.

Yesterday’s testimony by the Procurement director brought to the fore the influence of politicians and high-ranking state officials over government tenders.

Officials claimed that Sakaja actively lobbied for the award of the tenders, by physically camping in Manjari’s office.

Sakaja was at the time chairman of the Senate Ad-hoc Committee on Covid-19. He was later forced to resign after he was charged and fined for breaking curfew rules.

Documents tabled before the team show  that companies that were issued with supplies letters in Manjari’s office included La Miguela Holdings that supplied 20,000 PPEs worth Sh180 million, Shop and Buy that supplied 100,000 PPEs and 100,000 N95 masks at a cost of Sh970 million.

Others were Medilife Biologicals Limited that supplied 20,000 three ply tie masks, 200,000 N95 face masks, and 20,000 face shields all worth Sh240 million as well as Komtel Kenya Limited that supplied three million patient ventilators, 19,000 N95 masks and 20,000 three ply masks at a cost of Sh283 million.

The rest are Regal Freighters which supplied 60,000 three ply face masks at Sh270 million, Northlink GSC Limited which supplied 30,000 three ply masks at Sh135 million, Meraky Healthcare which supplied 700 N95 masks worth Sh140 million and Everywhere Distributors Limited which sold 10,000 PPEs, 10,000 eye protection goggles, 20,000 respirators and 10,000 face shields for Sh118 million.

The officials claimed that Manjari ensured that Walabis company that was associated with a Dr Wanjiru was awarded a tender to supply 100,000 PPEs.

But it is the tender awarded to Shop and Buy company worth Sh970 million that became a subject of heated debate in the committee after Juma said that Senator Sakaja sat in Manjari’s  office when the commitment letter was being processed.

Juma told MPs how his secretary, Ms Pamela Kaburu, was summoned to Manjari’s office on June 5 and told to prepare the commitment letter for Shop and Buy and backdate it to April 30 so that it could fall within the required timelines.

“For this one on Shop and Buy, my office was not aware, neither were my four managers ... when I asked my secretary what had happened, she told me that the personal assistant to the CEO had asked her to forward him the format for writing commitment letters and it is when she was taking the sample letter that she found the CEO seated with Hon. Sakaja in his office,” Juma said.

Apart from the eight companies, Juma also told the committee of how Manjari issued another commitment letter worth Sh4 billion to a company known as Kilig, which had never done business with Kemsa, way after April 30 without informing his office.

The Procurement team had advised the CEO to cancel all commitment letters issued after April 30.

According to him, his office was not aware of the tender as the letter was done in Manjari’s office and he came to know of the firm when Cidian Bank called him to confirm existence of the company.

“ On May 29, Sidian Bank called my office to confirm about Kilig, I told them it was not on my list and that is when I and four other managers went to the CEO to inform him of the commitment letters issued to Kiliig which we were not aware of,”  he told the committee.

“While in the office we took the opportunity and advise the CEO that the letter needed to be cancelled because we had enough stock and had no budget for further procurement but he brushed me off, saying some government technocrats had promised to avail money for the exercise and asked us to wait as he would get back to me the following week.

When this did not happen and he never reached out to me, I wrote to him and stood firm that the letter had to be cancelled and he had no option but to do it,” Juma said.

Pushed procurement

On his part, Muriithi distanced his department from any wrongdoing, saying they were only involved with the tender after the procurement and payment of the items were done.

Muriithi, who told the committee that Manjari had attended various meetings at the Ministry of Health where he was told to push on with certain procurements, said he had written to the head of procurement and advised him to stop further purchase of Covid 19 related items.

“I did issue an advisory through an email titled Stop procurement to the procurement director and managers.

I wrote to him because he was the line manager and was in charge of this whole process, I did this in April and by this time we had commitments of about Sh3 billion,” he said.

Manjari, who was not present during yesterday’s session, has appeared twice before the same committee.

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