Governors oppose plan to extend MES project

There seems to be no end in sight to the controversy surrounding the Sh43.5 billion Managed Equipment Services (MES), with some governors vowing not to extend the contract that expire on February 5.

The Ministry of Health has been making efforts to have the contract of the project extended for three more years despite resistance from some quarters.

According to contracts signed in 2015, the MES was a seven-year project “with the possibility of a three-year extension”.

The Sunday Nation has learnt that the extension issue has been tabled before the Council of Governors (CoG) on at least three occasions, the latest being towards the end of January.

The governors, sources say, refused to sign the extension on every occasion.

If approved, the extension will cost every devolved government Sh100 million a year.

The seven-year contract was signed by the ministry and MES providers on February 2, 2015.

A county was paying about Sh200 million a year.

Governors opposed to the extension want the machines taken back to their manufacturers.

In a memo seen by the Sunday Nation, the governors say what county governments have paid to lease the gadgets is too much.

They say it is easier and cheaper to buy the equipment directly, service them and train personnel instead of paying service providers Sh100 million a year when devolved units service the machines.

“We are not willing to commit to the project for another three years. Let county governments take charge of health docket,” the memo says.

Health Cabinet Secretary, Mutahi Kagwe, however says he is not aware of any opposition “since several governors have written to request more equipment, with many supporting the contract extension”.

The minister said the extension would not involve buying new machines but would mainly be for their maintenance and servicing.

That, he added, is defined in the service requirement and equipment schedule in the contract.

“The contract stipulates that after seven years, there is a three-year extension for servicing the machines. The contract will elapse after 10 years. Then we will be able to sign new contracts. This is not a new contract,” Mr Kagwe said.

A governor, however, told the Sunday Nation that the ministry “has been using all manner of justifications and threats” to convince the council to accept the extension.

In its appeal to the CoG, for instance, the ministry says county governments cannot repair the machines supplied under the MES and that contractors are the only ones who can supply spare parts.

“Why would anyone try to force a three-year renewal of the contract by claiming that counties do not have the capacity to repair the machines or biomedical engineers cannot do the work? What has the ministry been doing for seven years?” the governor asked.

It is understood that a number of MES local sub-contractors have also been piling pressure on individual governors to extend the contract.

The agents have been sending WhatsApp messages to governors opposed to the extension, urging them to change their stance.

Given the political divisions in Kenya, some governors not comfortable with the contract extension – especially those seeking re-election – fear speaking out in public.

Kisumu Governor Peter Anyang Nyong’o, who chairs the Health Committee of the CoG, did not respond to our queries over the extension.

Another governor, who also sought anonymity as he does not want to be seen fighting the government, said the extension would impoverish Kenyans as a few individuals make a killing.

“I wish I could tell the truth without being intimidated,” the governor said.

Mr Kagwe said he would not involve himself in the politics surrounding the project.

“We will work with those who want. Those feel the project is not important can run their affairs and explain to citizens why they do not want it,” the minister said.

“Let’s not trivialise health care. It is a matter of life and death.”

In May 2021, the ministry was at pains to explain the benefits of the lease.

MES was aimed at equipping hospitals with modern and specialised diagnostic kits.

It was the first mega project by the Jubilee administration after assuming office in 2013.

President Uhuru Kenyatta oversaw handing over of equipment to counties in the initial stages.

MES was conceptualised and approved as a public-private partnership project.

It was, however, quietly converted and implemented as a public project, an matter the Auditor General questioned.

On October 22, 2013, county executives of Health and Finance, alongside then Health CS James Macharia, signed a deal in which they agreed to identify two hospitals in every county that would be a beneficiary of MES.

But the project had not taken shape a year later because the government did not have the Sh43.5 billion for its initiation.

It had only allocated about Sh2 billion in the 2014/15 financial year to equip the hospitals.

The cost of the project has been the reason for the controversy.

The original contract was valued at $432,482,156.8 (Sh43.5 billion), meaning every county was to pay at least $1,314,535 (Sh118 million) a year, to be deducted at source and paid to MES contractors by the ministry.

The total amount was calculated and divided equally among the 47 counties whether they got the equipment or not.

Because four referral hospitals also gained from the project, the amount paid by a county was reduced to Sh97 million.

In 2017, the amount changed shot to Sh200 million. The reason given was that Kakamega, Taita Taveta, Vihiga, Narok and other counties requested additional kits.

The contracts for every firm was revised, with the cost shooting up from Sh43.2 billion to Sh46.9 billion. Treasury spread the additional cost across the 47 counties instead of billing those that wanted more equipment.

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