Discrepancies of Tk 3.5b in emergency procurement
The Central Medical Stores Depot (CMSD) last year purchased medical equipment and other protective items of about Tk 3.5 billion (Tk 350 crore), without following the official rules and regulations. In many instances, there weren’t even any proper contracts with the companies that supplied the equipment. In the entire procurement process, the quality of the products was not taken into consideration, neither were there any negotiations with the suppliers to ensure a fair price. On top of that, there was no monitoring to ensure that all the equipment was received as per order.
These purchases were made on an emergency basis last year before June, when the first wave of coronavirus broke out. Around 51 companies at the time supplied the medical equipment and other items to the Central Medical Stores Depot. The CMSD director on 9 February sent a letter to the health services division, under the health ministry, informing the authorities about irregularities in these purchases. He requested for action to be taken in this regard. He also recommended that a taskforce be formed to look into the matter.
Copies of this letter from the CMSD director were sent to the Prime Minister’s Office, the cabinet division, the finance division, the Directorate General Health Service (DGHS), central procurement technical unit of the Implementation, Monitoring and Evaluation Department (IMED) and the health minister.
CMSD is an institution under the health services division. Deputy director of the institution Touheed Ahmad, speaking to Prothom Alo, said, “We sent the letter and also suggested that a taskforce be formed. The health ministry has not responded as yet.”
After a company picked up the bill for Tk 4.50 billion (Tk 450 crore), it was found that the equipment never even reached the hospital. Motajjerul alias Mithu was the proprietor of that company and all the other companies that competed in the tender
The letter issued by CMSD said that the basic procedures of direct purchase in the Tk 3.5 billion (Tk 350 crore) procurement, such as approval of the purchase proposal, official bargaining, consulting the tender/proposal evaluation committee, etc, had not been followed. Despite the large financial involvement, the public procurement rules were not followed in taking the approval of the concerned authorities. No security deposit was taken and no supply agreement was signed. There was no specific deadline for delivery mentioned in the supply order. While the quantity of the equipment was specified, no per unit price or total cost was mentioned.
CMSD officials say that no budget allocation for this purpose had been specified at the time. These irregularities took place during the previous management of the CMSD. The contracting companies that supplied the medical equipment and other items last year without following the rules and regulations, are now demanding payment of their bills. Pressure is mounting for various quarters for these bills to be paid. CMSD officials at different levels often find themselves in awkward situations when confronted by the suppliers.
A letter was sent to the health services division last June, asking for certain bills to be paid for the Covid-19 equipment supplied during the previous management of CMSD. It had been said at the time that the procedural discrepancies in procurement were under investigation by the health services division. CMSD did not receive any directives from the health ministry in this regard.
An inquiry committee headed by the additional secretary (financial management and audit unit) of the health services division, Shahadat Hossain, had been formed at the time to investigate details of the procurement. When asked what the investigations had revealed, Shahadat Hossain told Prothom Alo, “We have learnt that these purchases were made under emergency circumstances. But the public procurement rules (PPR) were not followed at all.”
He said they had recommended departmental action against the concerned persons. He said that those who had been in charge of the CMSD administration at the time, were responsible for this. However, CMSD officials in the inquiry committee said that the procurement has been done on the sole decision of the director at the time. This problem can only be resolved by the intervention from a top level of the government.
On 22 May last year, the CMSD director Brig. Gen. Md Shahidullah has been removed and replaced by Abu Hena Morshed Zaman.
According to CMSD records, before June 2020, a plan had been made to procure 196 packages of various Covid-19 products at a cost of Tk 1285,22,42,000 (Tk 1,285 crore 22 lakh 41 thousand). Of this, the tender evaluation report of 57 packages costing Tk 344,11,57,000 (Tk 344 crore 11 lakh 57 thousand) was submitted to the Health Services Division for approval.
Three contractors who had provided coronavirus detection kits and PPE at the time, told Prothom Alo, the director of CMSD at the time had requested them to supply these items. At times he had even got them to speak to the health minister over mobile phone. The circumstances were such then that there was no time to bother about contracts, rules or regulations.
Incidentally, the CMSD director Md Shahidullah contracted coronavirus and passed away on 25 July last year. Before his death, on 30 May he had written a letter to the public administration secretary saying that the controversial contractor of the health sector, Motajjerul alias Mithu, in collusion with certain government officials, would plan the procurement and even the budget of the sector. Then CMSD would have to make purchases accordingly. Mithu had several companies in various names and these companies would take part in the CMSD tenders.
The letter to the public administration secretary said that CMSD had issued a letter for the procurement of certain equipment for Dhaka’s Suhrawardy Medical College Hospital. After a company picked up the bill for Tk 4.50 billion (Tk 450 crore), it was found that the equipment never even reached the hospital. Motajjerul alias Mithu was the proprietor of that company and all the other companies that competed in the tender.
The Anti-Corruption Commission (ACC) launched an investigation into allegations of Motajjerul accumulating wealth through illegal means. ACC sources say he had been out of the country for quite a few months now.
* This report appeared in the print and online edition of Prothom Alo and has been rewritten for the English edition by Ayesha Kabir