Governors approve the Sh39billion MES project

Council of Governors (CoG) chairman Wycliffe Oparanya. [File Photo]

Fresh details show that governors approved the Sh39 billion Managed Equipment Service (MES) deal despite their insistence that they were not aware of the transactions.

Documents in possession of The Standard indicate that health executives from all the counties met with the Health Cabinet secretary and signed a memorandum of understanding on the project.

The MoU was signed by then Health Cabinet Secretary James Macharia as chair of the Inter-Governmental Forum, while Dr Maurice Siminyu, the health executive from Busia as the vice-chair and George Kamau, the health and planning executive, from Murangá on behalf of the counties.

Criminal enterprise

“We CS health, County Executive Council members for Health and Finance having had a fruitful meeting to address the health issues ... resolve that ...the proposal to equip public health facilities with modern equipment and supporting infrastructure is commendable and is fully supported,” read part of the MoU.

Last week, a Senate health committee released its report on MES and noted that the project that equipped 98 hospitals across the 47 counties was ‘a criminal enterprise’ that was meant to fleece Kenyans.

In February 2015, the Ministry of Health entered into a deal with five global companies for supply of medical equipment to two hospitals in each of the 47 counties at Sh38 billion.

Under the lease scheme, Ministry of Health would equip at least two hospitals in every county and the equipment would be leased for seven years through a conditional grant that would see each county pay the ministry deduct Sh95 million annually from each of 47 counties for leasing of the equipment.

Initial contracts

The project that was approved by the health executives had been divided into seven lots including Lot 1: Implemented by Shenzhen Mindray Bio-Medical Electronics Company Ltd involving theatres in 96 hospitals, and Lot 2: Implemented Esteem Industries involving Central Sterilisation Supply Department (CSSD) in the same number of hospitals.

Others are Lot 5: Implemented by Bellco S.R.L involving Dialysis Centres in 49 hospitals, Lot 6: Implemented by Phillips Medical Systems Nederland B.V involving intensive care units (ICU) in 11 hospitals and Lot 7, Implemented by GE East Africa Services Ltd involving Radiology Diagnostics in 98 hospitals.

The total amount for the initial contracts was Sh39 billion ($432 million) and the MES project entails seven years’ contracts between the Ministry of Health and various contractors that provide for equipment supply, installation, maintenance, replacement, and disposal including training and reporting throughout the contract period.

The MoU was shared with all the 47 governors. Notably, Council of Governors chairman and Kakamega Governor Wycliffe Oparanya has previously insisted the county bosses were not privy to the deal and that it was done in secrecy.

“We have never seen the agreements of the MES programme between the suppliers and us, all we do is just pay; we do not know how much the supplier receives from what we pay,” said Oparanya.

According to the chair of the Council of Governors, the national government should pay for the equipment as grants to the counties, and the county bosses will then redirect the millions to other projects in the counties.

Currently, counties are paying Sh131 million - a variance from Sh200 million that they paid last year.

In 2015 the counties were paying Sh95 million totaling Sh4.5 billion but this was varied in 2017 to Sh200 million, bringing the total to Sh9.4 billion for all the counties per year.

The MoU signed by the counties chronicled the journey towards bringing the MES programme to being, including two motions in the National Assembly and the Senate. The MoU noted that the National Assembly passed a motion urging the government to equip at least one health facilities in every county.

A similar motion proposed by then Migori Senator Chris Machage was passed by Senate on June 26 2013, asking the national government to establish one level five hospital in every county and a level four in each sub-county before the end of its term.

Binding obligations

Senate ad hoc committee probing the MES project deal in September last year in its report implicate top government officers and local and international companies in what they said was a scandal.

The documents also show that former Attorney General Githu Muigai had approved the transactions for the MES.

Prof Githu had told the Senate that he had not approved the deal, back and forth letters with then Cabinet Secretary James Macharia indicate that he had given the project a go ahead.

“My office has independently reviewed the MES contracts and we hereby ascertain the validity of the contracts and further confirm that the obligations of the government expressed in in the transaction documents constitute legal, valid and binding obligations,” the document signed by Prof Githu read.