Agency revokes Sh524m NHIF tech system tender

The Public Procurement Administrative Review Board (PPARB) has cancelled a controversial Sh524 million tender by the National Hospital Insurance Fund (NHIF) after reported irregularities.

The PPARB, a quasi-judicial body, on March 1 ruled that Tender No. NHIF 015/2020-2021 for the supply, delivery, installation and commissioning of ERP and Claims Management System awarded to three companies was in breach of several procurement procedures and had, therefore, been cancelled.

The tender had been divided into three lots and bid by several companies.

Lot I of the tender was awarded to Medbook Kenya Ltd/Tech Mahindra EA at Sh135 million as the lowest bidder. Lot 2, which was worth Sh283,596,781.88 was awarded to Technology Associates EA that was the only responsive bidder. While Lot 3 worth Sh106,200,030 was awarded to Technology Associates EA that was the only responsive bidder.

“In exercise of the powers conferred upon it by Section 173 of the Act, the board makes the following orders in the request for review.

“The accounting officer of the procuring entity’s letter of notification of intention to enter in a contract for Lot I of Tender No. NHIF/015/2020-2021 for supply, delivery, installation, testing and commission of an ERP and Claims Management System dated January 26, 2021, addressed to the third respondent and all unsuccessful bidders, be and are hereby cancelled and set aside.” the final order says.

Recommended prices

The review board further ordered that NHIF should ensure that the recommended prices of the three lots are in line with indicative market prices in accordance with Regulation 33 (3) (aa) and 78 (40 of Regulations 2020 to inform award of the subject tender in the lots in accordance with Section 86(1)(a) of the Act and Article 227 (1) of the Constitution, subject to a due diligence exercise carried out on the lowest evaluated tenderer in all the lots of the subject tender in accordance with clause 2.24 of Section 2.1.

However, PPARB also orders to proceed with the procurement to its logical conclusion and where an award is made, to issue notification of intention to enter into a contract to all bidders under Section87 of the Act read together with regulations 82 of Regulations 2020 taking into consideration, the board’s findings in the review.

The order is signed by PPARB chairperson Faith Waigwa and secretary Stanley Miheso.

One of the bidders Dermalog Identification Systems Gmbh, Compulynx Limited, Liason Healthcare Limited, LCT Africa Ltd that were joint venture partners and a consortium of Intrasoft International S.A Intrasoft International East Africa Limited made an application No.19/2021, which as consolidated with application No. 10/2021 and application No. 19 challenging the awarding of the tenders awarded to Medbook Kenya

The tender was published in the MyGov newspaper, NHIF’s website and the Public Procurement Information Portal on October 13, 2020, with a bid submission deadline set at November 25, 2020, and later extended December 9, 2020, through an addendum by NHIF on November 19.