The Ministry of Health is staring at a Ksh40 billion ‘debt’ owed to tenderpreneurs who have been awarded the amount by courts in a span of 21 years over tender wars.
The amount was awarded to two entities, Equipment Agencies Limited and Faram East Africa Limited, who had sued the ministry for breach of contract.
The amount has accrued interests over the years, and if paid at once could cripple services at the ministry which received a budget allocation of Ksh80 billion in the current financial year.
“We have historical pending bills that goes back to the year 1999. We owe two suppliers Sh40.2 billion who sued us and won court awards. The Ministry was sued by the suppliers and we are concentrating on historical pending bills,” said Susan Mochache, the Health principal secretary while appearing befor the Parliamentary Public Accounts Committee.
Equipment Agencies alleged that it supplied malaria control equipment, drugs and protective clothing for a principal amount of Ksh1.1 billion on which the interest of 18 percent per annum was Ksh7 million in 1999, bringing the total to Ksh1.8 billion.
Faram East Africa Limited said that they supplied of 50 low heat thermal treatment units for sterilising and shredding medical waste for Ksh14 million.
“We will be meeting the two suppliers, officials of the Attorney General and Ministry of Finance to negotiate on this huge bill. The Attorney General’s office is steering these discussions,” said the PS.