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Documents for $124m in equipment missing - Auditor general delivers scathing report on SERHA's procurement

Published:Wednesday | May 31, 2017 | 12:00 AMJovan Johnson

A lack of documentation surrounding the purchase of approximately $124 million worth of equipment highlights the weak procurement-management system at the South East Regional Health Authority (SERHA), the auditor general has said in a scathing report of the health body that oversees 47 per cent of the country's population.

The problems start with the top leadership of the authority, whose actions were looked into for the financial years 2011-12 to 2016-17 - the period of the auditor general's performance audit - to determine whether SERHA was managing its procurement activities well to obtain value for money.

Pamela Monroe Ellis emphasised the need to get value for money, given that for the audit period, the Parliament approved $87.6 billion to SERHA, $30 billion less than the $120 billion the health authority requested. Of the allocated amount, almost $26 billion went to purchasing goods and services.

Given the tight budget situation, the auditor general noted that boards of directors did not define strategies for regional needs assessment to guide the allocation of resources. "SERHA's approach towards determining needs was limited to discussions at monthly management meetings and compiling budgets" submitted by hospitals and health departments.

Doing that, the report said, "limited" the ability to develop suitable procurement plans and to maximise value for money.

In addition, Monroe Ellis said that SERHA did not incorporate an analysis of related data in making decisions on what goods and services to buy. She said that the procurement files were "manual and unstructured", which did not help in analysing how the expenditure was going.

"We were also unable to review the procurement process for 20 contracts for works and purchase of biomedical equipment valuing $123.5 million because the requested files could not be located," she said.

SERHA owes NHF $3.5b

The South East Regional Health Authority (SERHA) at March 31 owed the National Health Fund (NHF) $3.5 billion. Hospitals and health departments under this agency bought $6.5 billion in pharmaceuticals and medical sundries between March 2011 and September 2016.

But the Auditor General said SERHA could not determine if NHF's prices were competitive and the inability to do so may be linked to the "undue reliance on the NHF credit facility".

The report was tabled in the House of Representative on Tuesday. SERHA has responsibility for nine hospitals, 91 health centres in Kingston, St Andrew, St Catherine and St Thomas.