New GPC drugs…PAC grills Health
Ministry over undelivered supply
despite payment
Amidst ongoing questions over Government’s procurement of drugs for its hospitals, a Parliament oversight committee yesterday mandated the Ministry of Health to prepare a report on millions of dollars of items that were not delivered in 2011 and what is being done to correct the situation.
Health Ministry’s Permanent Secretary (2nd l) and his team during the Parliamentary meeting yesterday.
The Public Accounts Committee (PAC) was examining the Auditor General’s 2011 report. The Ministry of Health was called on to answer a number of issues that has been raised.
One of these includes outstanding deliveries of $88.1M worth of drugs that was not delivered that year by New GPC, but was paid for.
New GPC is a company that has been under scrutiny by the Opposition for its close ties to the administration. For over a decade now, the company, controlled by Dr. Ranjisinghi ‘Bobby’ Ramroop, a close associate of former President Bharrat Jagdeo, has been benefitting from almost a monopoly, worth billions of dollars annually, on supply of pharmaceuticals.
However, the process of procurement, the storage of the drugs, and the price have all come under question.
Because of the billions of dollars involved, PAC has been keeping a close eye to the issue.
Permanent Secretary of the Ministry of Health, Leslie Cadogan, disclosed that strong management has been put in place to ensure that contracts are properly managed. One of these includes ensuring that the bank guarantees are in place for contractors.
The 2011 report had flagged bank guarantees by New GPC as being expired when the state auditors were making their checks. The guarantees are crucial in case the supplier, breach the contract and claims have to be made.
Cadogan said there are better systems to manage the deliveries of millions of dollars to the hospitals and health centres, but admitted there is lots of room for improvement.
Regarding the outstanding $88.1M in pharmaceuticals which were not delivered, PAC was told a number of startling details. The Ministry had taken a decision, without receiving authorization from the tender board authorities, to have New GPC “swap” almost $20M of drugs for others.
Auditor General, Deodat Sharma, said that this complicated the matter.
There were several searching questions by Member of Parliament for A Partnership For National Unity, Jaipaul Sharma, on the systems used for delivery and storage.
The Health Ministry said that New GPC had objected to the amount not delivered, providing documents that it did. There is a team doing reconciliation.
While New GPC produced delivery notes, some of the Ministry’s store records were not found.
However, New GPC has since delivered over $76M, leaving over $11M outstanding, PAC was told.
There were questions yesterday on what systems were being used to store the drugs.
According to Cadogan, a significant number of problems were reduced with the storage of drugs after the commissioning of a bond in Diamond, East Bank Demerara.
With some drugs having a short shelf life, the Ministry has been challenged to manage its inventory with auditors finding over $208M in expired items at the time of its examinations.
The Permanent Secretary disclosed that both manual and electronics systems are being used to manage the inventory of pharmaceuticals.