The Ministry of Health has halted procurement-related payments and instituted an investigative audit for fear that fraud may have hit them to the core.
This follows revelations that the ministry would have lost almost K90 million if a fiscal agent was not involved on multi-million kwacha payments that were due to two service providers.
The ministry’s Principal Secretary (PS) Dan Namarika, according to a memo dated September 19 2018, ordered the investigative internal audit relating to dealings with Techno World and Design Printers.
The ministry effected deductions on payments to the two firms, stating that payments would only be made depending on the findings of the audit, according to Namarika’s memo.
The PS also indicated that the audit must extend to all other procurements at the ministry’s donor-initiated Programme Implementation Unit (PIU).
The ministry’s spokesperson Joshua Malango said, in a written response to a questionnaire, that it is not unusual for a controlling officer to call for an audit anytime there is a risk on a big procurement.
He said the ministry was still waiting for the internal audit findings.
“The [fiscal] agent is a compliance officer designated by Global Fund, but you need to take note that we also have other compliance officers seconded by Ministry of Finance for pre-audit purposes. Compliance officers are also available in other ministries,” Malango said.
But annoyed with the ministry’s decision, Techno World—engaged to supply laptops to be used for data entry in public health facilities—has dragged the ministry to court for breach of contract.
Techno World is demanding full payment of K273 million which was signed for in the contractual agreement, according to their lawyer Burton Chimango Phiri.
The ministry, through its PS, had directed in the September 19 2018 memo that Techno World be paid K201 018 525, less by over K72 million.
In an interview on Tuesday, Phiri said his client fulfilled the contractual agreements and are expecting what is due to be paid.
He said the ministry expressed reservations on pricing and deducted the sum due, hence his client decided to take the matter to court.
“Should the defendant (Ministry of Health) opt to take the position stated in the letter [dated September 19 2018], we shall accordingly deal with that.
“The good thing is that my client made a clean transaction and as far as my client is concerned, the [ministry] ought to pay the full contractual sum plus other losses occasioned by the breach of the defendant,” the Techno World lawyer said.
On the other hand, Design Printers administrator Billy Chimimba confirmed in a separate interview on Wednesday that his company was paid about K250 million after delivery of the service.
He said they have since written the Ministry of Health to notify them about their K17 million balance, adding that they were not aware of any query from the ministry until Nation on Sunday raised the issue to them for comment.
Chimimba said: “We have not received a response to the letter we wrote them [about the balance due]. We delivered our service and we were convinced we satisfied all the contractual agreements.”