Kenya Faces Financial Loss of Sh8.3 Billion Due to Undelivered Covid-19 Vaccines
Kenya faces a potential Sh8.3 billion loss over undelivered Covid-19 vaccines, as per an audit report by Auditor General Nancy Gathungu. Despite contracts for 13.33 million doses, only 1.80 million were delivered. Interest penalties have added to the financial burden. This issue revives concerns over procurement scandals within the health sector, emphasizing the need for improved accountability and governance.
Kenya is potentially facing a substantial financial loss of Sh8.3 billion linked to undelivered Covid-19 vaccine doses. An audit report by Auditor General Nancy Gathungu revealed that the Ministry of Health made payments for vaccine doses that were never shipped, prompting concerns about public spending accountability. The Ministry had previously contracted the Africa Vaccine Acquisition Trust (AVAT) to procure 13.33 million doses, with only 1.80 million actually delivered, resulting in a pending balance of 11.52 million doses.
The Ministry’s indication that it no longer required the additional doses does not negate its financial obligations under the contract, which requires payment for the entire order. As of August 2022, another 2.72 million doses were manufactured but remained unshipped. The audit report noted, “The unshipped component was indicated as no longer needed and was due for destruction.” Furthermore, interest penalties on delayed payments have accrued to Sh930.59 million, compounding Kenya’s financial burden.
An outstanding obligation of $64.88 million, equivalent to Sh8.38 billion, was reported in a statement from AVAT. There is growing scrutiny regarding the lack of proper assessments by health officials prior to executing this large procurement. The Auditor General cautioned that the value from the agreement may not be realized, raising the risk of additional interest penalties with ongoing delays in account settlement.
This situation evokes memories of previous Covid-19 procurement scandals involving the Kenya Medical Supplies Authority (Kemsa), where substantial taxpayer losses were incurred through questionable deals. In 2021, members of Parliament suggested the prosecution of senior officials at Kemsa for irregular procurement practices; however, accountability remains elusive, with no high-ranking officials penalized to date.
The urgent need for vaccine procurement during the pandemic was understood, yet the mismanagement of funds has left Kenya grappling with significant financial repercussions. While the government is seeking to have AFREXIMBANK waive the interest penalties, a decision on this request remains pending.
The revelations surrounding Kenya’s loss of Sh8.3 billion due to undelivered Covid-19 vaccines underscore the critical need for accountability in public spending. Despite the urgent circumstances of the pandemic, inadequate assessments and contractual obligations have resulted in significant financial liabilities. Furthermore, the history of procurement scandals raises serious questions about governance and oversight in the health sector. Moving forward, it is essential for Kenya to enhance transparency and accountability to prevent recurrence of similar issues.
Original Source: eastleighvoice.co.ke
