This archive report was first published on 10 October 2019.
At least Sh30 million in taxpayers' money has been lost after Kenyatta National Hospital (KNH) entered into contracts with three different companies that failed to deliver, despite receiving down payments.
One of the cases dates back to 2003 when KNH contracted Glotex Medical Kenya Ltd to supply nuclear medicine, equipment, and accessories. The hospital paid Sh13 million upfront to a company not registered to supply nuclear medicine materials.
Despite the hospital's efforts to recover the funds for 16 years, it appears unlikely that the money will be repaid. An audit report from the 2017/2018 financial year indicates that Glotex Medical Kenya Ltd is not registered, making it impossible to take legal action against the non-existent entity.
KNH also entered into a contract with High Voltage Communication Ltd in 2001 for the supply, delivery, and installation of submersible pumping equipment. The hospital made an advance payment of Sh15,792,611, but the company failed to complete the work without a good reason, leading to a dispute. The matter was referred to arbitration, where KNH won and was awarded Sh14,876,645 in November 2012, but the hospital has yet to be paid.
Additionally, taxpayers lost Sh2,213,309 paid to Microtec Office Supplies for delivery and installation of microfilm equipment. Despite KNH paying 60% of the amount, the company only completed 30% of the work.
KNH's acting chief executive, Evanson Kamuri, stated in a letter dated May 14 that the hospital is following up on the signatories to the accounts to recover the amounts advanced due to breach of contract.
