The Sh6b question: Health officials on the spot over medical equipment leasing deal

The Ministry of Health is at pains to explain whether the public got value for money from the controversial lease of medical equipment worth over Sh63 billion.

Appearing before the parliamentary Public Accounts Committee (PAC) today, Ministry of Health officials were pressed to clarify why the equipment in Kakamega, Elgeyo Marakwet, Murang'a, Samburu, Meru, Tharaka Nithi, Lamu and Machakos counties had not been put into use yet they continue to incur costs.

Health Principal Secretary Susan Mochache, appearing before the MPs, was on the spot when they demanded a detailed explanation of why the ministry signed and later varied the contracts for the Managed Equipment Services (MES), yet a needs assessment report was not done.

The legislators demanded to know the parameters and the criteria used to arrive at the variations and how long the contract was in place before the alterations took place.

PAC chairperson and Ugunja MP Opiyo Wandayi asked whether there was a scientific basis that informed the decision of the ministry.

“So there was no scientific basis in the nature of a needs assessment, that whatever decision was made was based on feelings,” said Wandayi.

According to the MPs, the needs assessment report could have formed the basis for the variation of the contract leading to the lease of additional equipment for the 24 hospitals in 24 counties.

Mochache, while responding to audit queries relating to the financial year 2018/2019, admitted that a need assessment report was not conducted.

 Mochache. said their report highlighted what was considered as a justification.

Initially, the ministry had entered into agreements with five medical contractors for the lease of medical equipment to ninety-eight hospitals across the forty-seven counties under the scheme.

The legislators, led by Wandayi and Garissa Township MP Aden Duale accused the ministry of hurriedly rushing to vary the contract yet there was no scientific evidence to back the move.

Wandayi said the variations took place on the basis of nothing thus causing loss of taxpayer’s money.

“By the time these variations were taking place, how long was this contract in place. I am told that the entire scheme is about six years old and the variations were done somewhere in 2017 which is about three years ago, this means that the scheme was only in place for about two to three years and based on that it is obvious that the variation was done based on nothing,” he said.

He added: “The basic thing was for you to do a needs assessment task, this is just common sense but so far nothing has been done. I want to conclude that this is wasted money.”

Duale sought to know whether in the absence of an assessment report the ministry carried out a contingency plan to know what will happen in the absence of basic requirements such as water, electricity needed to sustain the project.

In her response, Mochache said the MES was to ensure accessibility of healthcare to those in rural areas and bring services closer to the people.

“This project, even if it has challenges, has really been of help to our citizens, if you visit some hospitals you will realise this is the case," she said.

According to Auditor General Nancy Gathungu, although the ministry on February 6, 2015, entered into agreements with five medical contractors for lease of the medical equipment, the same ministry on October 16, 2017, and November 22, 2017, signed variations of contracts with three suppliers for leasing of additional medical equipment to twenty-four hospitals in twenty-three Counties.

“As of 30 June 2019, the Ministry had paid a total of Sh26, 342,824,540 to the various medical contractors and consultants, out of which an expenditure of Sh8, 794,740,483 relates to 2018/2019 financial year. The expenditure of Sh8, 794,740,483 included Sh902, 231,552 in respect of the variation of contracts,” said Gathungu.