A NEWS Diggers Investigation has revealed that the Ministry of Health paid a Chinese company called Ganzhou Etone amounts exceeding US$1.5 million (approximately K31.3 million) for supply of Coronavirus test kits under a tender that was awarded to a different firm called Kingphar Company Ltd.
The investigation has also revealed that companies that ‘competed’ and were awarded Covid-19 supply contracts at the Ministry of Health were owned by the same people or their relatives, while others had inside connections in the procurement committee at the ministry that helped in preparing bid documents.
Further, the investigation has revealed that one of the companies that was awarded a supply contract did not specify what kind of goods it was tendering for while another was awarded a contract to supply thermometers when it applied to supply BP machines.
According to the Public Procurement Act No. 12 of 2008 schemes between two or more bidders, with or without the knowledge of the procuring entity, designed to set bid prices at artificial, non-competitive levels is a prohibited collusive act and a crime, as is the fraudulent practice of “misrepresentation facts in order to influence the procurement process or the execution of the contract.”
Records at the Ministry of Health indicate the following companies were awarded contracts related to Covid-19 this year:
See tableTable1 Covid suppliers
The probe revealed that the ministry paid US$1,021,230 and another US$498,892 to Ganzhou Etone Foreign Economic and Technological Cooperation company Ltd of China for a contract which was awarded to the Kingphar Company contract.
Ganzhou Etone did not have a Covid-19 supply contract with the Ministry, but the ministry had a contract with Kingphar worth US$2,047,568 for the supply and delivery of Fever Screening Handheld Thermometres, SAR-Cov-2 Nucleic Acid Detection Kit (real time PCR) and Coronavirus Ant-body Tests among others supplies.
And the investigation also revealed that three companies bid for the contract that was awarded to Denshabula Investments Ltd for the supply and delivery of (100) digital BP machines.
The three bidders were, (1) Denshabula Investments Ltd owned a Mr Elijah Shabula, a known PF cadre, and his wife Malama Zyambo, (2) Pearbrand Enterprises which is owned by Malama Zyambo and her sister Salima Zyambo; and (3) Lamavril General Supplier owned by Malama Zyambo as a sole proprietor.
A scrutiny of the purchase enquiry issues by the MoH dated 19/03/ 2020 to the above three bidders revealed that it was drafted by a procurement officer in the ministry, Luwi Daka. The purchase enquiry indicated that the ministry wanted to procure 100 thermometers, but the Denshabula and Lamvril quotations quoted supply of 100 Digital BP machines, which was at variance with the ministry enquiry requesting quotations for 100 thermometers.
In the case of Pearbrand Enterprises, records show that the firm’s quotation did not indicate the description of the goods that the company was quoting for. The Ministery Procurement Committee (MPC) paper No. 086 of 2020 dated 23/03/2020, recommended that the contract be awarded to Denshabula at K130,000 and this was approved on 25/03/2020.
On the Ministry’s call for the supply and delivery methylated spirit and jik, records showed that three companies bid for the tender namely: (1) Friltech Networks which is owned by a Francis Muchemwa a known PF cadre and his brother Mwila Muchemwa; (2) JB Thorite Enterprise owned by Julian Mutale and Bernadette Mulenga Chintu, registered at PACRA on February 2, 2020; (3) Frasphere Connect Enterprise owned by Kheke Chana and Francis Mwiiya, also registered at PACRA in February 2020, which is a month before the two firms participated in the tender.
The investigation revealed that Mutale works at Friltech Networks Ltd and some of the quotations and invoices to the Ministry of Health by Friltech show that they were signed by “Julian Mutale”.
Further, the investigation revealed that Friltech Networks competed with two other companies in a tender to supply hand sanitizers. The other company which bid was JB Thorite Enterprise, but the quotation for this firm was prepared by Julian Mutale who also works for Friltech, a competing entity.
An analysis of the three quotations shows that the competing companies share the same contact phone numbers, but the ministry procurement committee went ahead to award the contract to Friltech at K298,400 during its meeting held on March 25, 2020.
The Friltech tax Invoices number 017 and 009 as well as the delivery note No. 016 issued to Ministry of Health is respect of the said contract shows that they were issued by Mutale, the owner of JB Thorite and an employee Friltech.
The Ministry of Health goods received note (GRN) dated March 30, 2020 in respect of this contract shows that the said goods were delivered to Ministry of Health stores section by a Mr Enock Chikwati. The probe showed that Chikwati who delivered the Covid-19 supplies on behalf of Friltech is the same person who issued the quotation for KET General Dealers, a company that was purporting to be a competitor with Friltech in the same tender.