Health Ministry still to receive drugs, medical supplies purchased in 2015

Health Ministry still to receive drugs, medical supplies purchased in 2015 – PAC report

Jun 03, 2019 News

The Public Accounts Committee, (PAC) has again highlighted problems with the award of contracts and the distribution of drugs and medical supplies by the Ministry of Public Health.
In its 2018 report, which was recently laid over in Parliament, the PAC noted the issues regarding drug suppliers, who failed to deliver drugs and medical supplies to the agency in a timely manner are of great concern to the committee. According to the PAC report, several of the issues, which were highlighted in the 2015 Auditor General Report remain unresolved. In some cases, drugs and medical supplies purchased are still to be delivered.
The Head of the Budget Agency told the Committee that a number of suppliers had delivered in full while others had committed to deliver the outstanding supplies. The Committee recommended the Auditor General, (AG) of Guyana conduct a value for money audit on drugs and medical supplies and a detailed audit of drugs within the Ministry.
Further, the report stipulated that an enquiry was made in regard to the total amount of money expended in 2015 for the purchase of drugs and medical supplies.
The Committee was informed that in December 2015, the total of $38M was spent on drugs and medical supplies by the Region while the Minister of Public Health expended $5.371M. However, during a discussion, it was recognised that there were discrepancies within the Region in relation to drugs and medical supplies. As a result, the Auditor General was asked to follow up the matter and report to the committee.
A previous AG report had noted that six suppliers received full contract sums totaling $163M in 2012. However, they failed to deliver drugs and medical supplies totaling $114M. These are still outstanding for the year 2012.
These companies include Productos Roche, Caribbean Medical Supplies, Trans Continental Ltd and Henry Schien Inc. In a related matter, the New GPC Inc. was still to supply a total of $12M worth of deliveries in respect of the year 2011.
The Budget agency of the then Ministry of Health had acknowledged that the deliveries are still outstanding. It was subsequently recommended that the Ministry take immediate steps to have the contractors fulfill the obligations under the contracts for the years 2011 and 2012.
The AG’s report also stated that in 2013, the Ministry expended $2.7 billion for pharmaceutical and medical supplies. The procurement of pharmaceutical and medical supplies by the Ministry of Health was based on awards by the National Board of Procurement and Tender Administration to the New GPC Inc. and other local and international agencies involved in the supply of drugs and medical supplies. In relation to the 2013 purchases, the transactions with New GPC included ten contracts valued at $2.4 billion of which freight charges totaling $180.496M were included in three contract sums.
The contracts were supported by six bank guarantees with an aggregate value of $2.554 billion. The guarantees were required to be valid for one year, but each had a validity of only three months and a set expiry pattern in months ending October 2013, January 2014, February 2014 and March 2014.
There were no guarantees enforced at the time of the examination in July 2014, but the contractor was still to deliver goods valued at $323.321M. The Head of the Budget Agency acknowledged the finding and indicated that efforts are ongoing to ensure that all outstanding drugs and medical supplies are delivered.
In relation to suppliers other than the New GPC Inc., payments totaling $435.344M were made to 21 local and overseas suppliers. However, only one contract for goods valued at $71.009M was supported by a bank guarantee.
At the time of reporting, nine suppliers did not fully satisfy their obligations with the result that goods valued at $192.057M remained outstanding.

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