Kenya is at risk of losing Sh8.3 billion for undelivered Covid-19 vaccines, as revealed by an audit report. The Ministry of Health paid for vaccines that were not shipped, with only 1.8 million out of 13.33 million doses delivered. This financial burden is compounded by interest penalties, raising serious concerns about public expenditure accountability.
Kenya is bracing for a potential loss of Sh8.3 billion due to undelivered Covid-19 vaccine doses, as revealed in a recent audit by Auditor General Nancy Gathungu. The Ministry of Health made payments for vaccine doses that were never fully delivered, which raises significant concerns regarding accountability in public expenditure. The report indicated that only 1.80 million of the 13.33 million doses procured from the Africa Vaccine Acquisition Trust (AVAT) and the Export-Import Bank (AFREXIMBANK) were received, leaving an outstanding balance of 11.52 million doses.
Despite the government deciding it no longer needed the unshipped doses, the terms of the contract mandated full payment. As of August last year, 2.72 million doses had been manufactured but remained unshipped. According to the report, the unshipped doses were deemed unnecessary and designated for destruction, further complicating the matter.
In addition to the principal sum, the delayed payments have accrued interest penalties totaling Sh930.59 million, exacerbating Kenya’s financial obligations. The statement of account from AVAT noted an outstanding obligation of $64.88 million, equivalent to Sh8.38 billion. This situation has prompted scrutiny over the procurement decision-making processes within the Ministry of Health.
The Auditor General cautioned that the lack of realization of value from the vaccine supply agreement places the government at risk for additional interest charges due to ongoing delays in account settlement. This revelation recalls previous procurement scandals linked to the Kenya Medical Supplies Authority (Kemsa), which resulted in substantial taxpayer losses, with recommendations made to prosecute senior officials involved in irregularities.
Despite extensive investigations into Kemsa’s handling of Covid-19 procurement, no senior official has faced accountability. While the National Assembly demanded refunds from suppliers who charged inflated prices, the effectiveness of these directives remains uncertain. Throughout the pandemic, Kenya reported over 350,000 Covid-19 cases and more than 5,000 fatalities, emphasizing the dire need for vaccine procurement. Unfortunately, the mismanagement of this urgent task has led to significant financial repercussions. The government has approached AFREXIMBANK to request a waiver of the interest penalties, but approval has yet to be granted.
In summary, Kenya is poised to incur a loss of Sh8.3 billion due to the procurement of undelivered Covid-19 vaccines, as highlighted by the Auditor General’s report. The government faces considerable financial liabilities due to both unmet delivery requirements and accruing interest penalties. This situation underlines ongoing accountability issues in public spending, reminiscent of past procurement scandals. It is imperative for health officials to conduct thorough assessments to prevent similar financial burdens in the future.
Original Source: eastleighvoice.co.ke