THE Ministry of Health has revealed that disciplinary action, including termination of employment, transfers and demotions, has been taken against some officers who participated in the procurement of some face masks costing US$39,900 which were delivered two days before the contract was signed.
And the ministry has justified its decision to award more than one contract to the same company, arguing that instructions did not limit the number of contracts to be awarded to successful bidders.
Appearing before the Public Accounts Committee (PAC), Tuesday, Ministry of Health Permanent Secretary for Administration Dr George Magwende said disciplinary action was taken against officers who participated in the procurement of over 7,000 face masks costing $39,900.
“On 25th March 2020, the Ministry and Emerald International Limited signed a contract for the Supply and Delivery of Personal Protective Equipment (N-95 Respiratory Face Masks) to support response towards COVID-19 at a contract sum of US$250,000 VAT exclusive with a delivery period of 7 to 10 days. The supplier delivered 50,000 N-95 face masks costing US$250,000. As at 31st October 2021, the supplier had been paid amounts totalling US$211,479. The Ministry issued the Purchase Order on 25th March 2020 after the contract was signed,” Dr Magwende said.
“However, a review of delivery note No. EI-005 issued by the supplier revealed that the supplier delivered 7,980 N-95 face masks costing US$39,900 to Zambia Medicines and Medical Supplies Agency (ZAMMSA) on 23rd March 2020 which was two days before the contract was signed thereby raising concern in transparency and contract management. The observation from the Auditors is correct. This is part of the anomalies which disciplinary actions have been taken against the concerned officers leading to termination of employment contract, demotion and transfers. There was also need to subject the procurement to competition in order to obtain value for money. This also attracted disciplinary actions against the concerned officers.”
Dr Magwende admitted that there were lapses in contract management where procedures were not followed, but hastened to add that disciplinary actions had been taken against concerned officers.
“12 selected contracts signed between 30th July and 30th September 2020, in amounts totalling K210,200,000 for the supply and delivery of KN-95 face masks and 3-ply disposable surgical face masks. As of As of October 2021, amounts totalling K44,200,000 had been paid to the suppliers. 10 out of 12 suppliers did not provide Performance Securities for the contracts. There were lapses in the contract management by the Ministry,” Dr Magwende said.
“Disciplinary actions have since been taken against the concerned officers, leading to termination of employment contract, demotions and transfers. However, despite failure to provide the Performance Security as provided for in the contract, the suppliers managed to deliver the goods in full and within the contract period. Management has continued to insist to all eligible suppliers in such dealings to provide Performance Security as it is part of the requirement.”
And regarding the Auditor General’s report that 34 suppliers were awarded 79 contracts worth K1,324,850,970, while in some cases the same suppliers were awarded between two to four contracts each, Dr Magwende said there was no limit to the number of contracts one bidder could get.
“I wish to acknowledge they there were some suppliers who were awarded more than one contract. This is due to the fact that the instructions issued to the bidders did not limit the number of contracts to be awarded to successful bidders. During the response to an emergency like COVID-19 magnitude, especially with the global market distortion caused by lockdowns, walk in clients were considered for the supply and delivery of COVID-19 commodities which were critically and urgently required. Most of the suppliers had the commodities readily available. However, transparency and accountability should never be compromised at all costs,” Dr Magwende said.
Dr Magwende said identification of suppliers for COVID-19 materials was not based on the name or if they had dealt with the Ministry before.
“The observations made by the Auditor General that the Ministry of Health invited requests for quotations from companies whose names and nature of business does not relate to medical supplies, are part of the issues raised in questioning the integrity of the procurement process, accounting in part to what led to the disciplinary actions. However, the main criteria used in the evaluation of procurements was not based in the name of the supplier but in PACRA Certificate of Incorporation, valid tax clearance certificate and other terms which made them eligible to participate,” he said.
Dr Magwende said the Ministry had put a system in place to ensure contract managers were appointed for each awarded contract.
“I wish to state that such are part of the lapses identified in the administration of contracts. One main reason attributed to this failure was lack of appointment of contract managers. You may wish to know that disciplinary actions were taken against the concerned officers. The Ministry has put a system in place to ensure that Contract Managers are appointed for each contract awarded to look into the management of contracts and ensure proper execution and adherence to all contact provisions to avoid such irregularities,” he said.
Meanwhile, nominated member of parliament Likando Mufalali requested the Ministry of Health to provide a list of all suppliers contracted by the Ministry, including details of ownership while Nalolo PNUP member of parliament Imanga Wamunyima said the Ministry needed to provide evidence of all disciplinary actions taken against concerned officers.
And Solwezi West UPND member of Parliament Nicholas Mukumbi insisted that former Permanent Secretary for Administration Dr Kakulubelwa Mulalelo needed to physically appear before the PAC given the gravity of queries which needed to be answered.
But in response, Dr Magwende indicated that Dr Mulalelo was in India and could only respond to queries virtually.
In conclusion, PAC acting chairperson Jacqueline Sabao directed the witnesses to provide documentation as requested by members of the Committee as they reappear today (Thursday0, February 24, 2022.