Kenya may incur a loss of Sh8.3 billion due to payments for undelivered Covid-19 vaccines. An audit reveals that the Ministry of Health paid for doses in a contract of 13.33 million, but only 1.80 million were delivered. The failure to properly assess the procurement needs is raising concerns about accountability in public health spending.
The recent audit report by Auditor General Nancy Gathungu has unveiled that the Kenyan government is potentially facing a financial loss of Sh8.3 billion due to payments made for Covid-19 vaccines that were not delivered. This issue arises from an agreement established in 2021 between the Ministry of Health and the Africa Vaccine Acquisition Trust (AVAT) which involved procuring 13.33 million vaccine doses for Sh7.46 billion. However, only 1.80 million doses were delivered, leaving a deficit of 11.52 million doses.
Despite the Ministry of Health’s indication that the additional doses were no longer required, contractual obligations mandated the complete payment for the order. Reports suggest that 2.72 million doses had already been manufactured but remained unshipped as of August last year. The audit report notes, “The unshipped component was indicated as no longer needed and was due for destruction.”
Moreover, financial penalties have accrued due to delayed payments, resulting in an additional Sh930.59 million. In total, the report cites an outstanding obligation of $64.88 million, equivalent to Sh8.38 billion. This situation raises significant accountability concerns regarding the decisions made by health officials during the vaccine procurement process.
The Auditor General cautioned that the failure to realize value from the vaccine supply agreement poses risks of further interest accumulation. This situation invokes memories of previous scandals associated with the Kenya Medical Supplies Authority (Kemsa) and its handling of Covid-19 procurement, which led to substantial financial losses due to irregularities.
Despite various investigations into Kemsa’s procurement practices, there has yet to be accountability for high-ranking officials. Furthermore, previous recommendations for suppliers to refund overcharged amounts have not been effectively enforced. While Kenya has experienced significant Covid-19 infection rates and fatalities, mismanagement during this urgent period now burdens the nation with financial repercussions. The government has sought to alleviate the penalty interest from AFREXIMBANK, but a decision on this request remains pending.
In summary, the Kenyan government’s payment for undelivered Covid-19 vaccines has resulted in a significant potential loss of Sh8.3 billion, highlighting serious issues of accountability in procurement processes. The contractual obligations to pay despite unfulfilled deliveries and the associated financial penalties further exacerbate the problem. This scandal echoes previous issues within the Kenya Medical Supplies Authority, where accountability has been lacking. Moving forward, effective measures must be taken to prevent similar occurrences and enforce accountability within procurement practices.
Original Source: eastleighvoice.co.ke
