Ex-PM Muhyiddin 'misspoke' on vaccine pricing, PAC hears

 

PARLIAMENT | Muhyiddin Yassin misspoke on the budget to vaccinate Malaysians against Covid-19 when he was prime minister, according to testimonies before the Public Accounts Committee (PAC).

According to the Hansard for the Jan 5, 2021, PAC hearing, this was revealed when then science, technology, and innovation minister Khairy Jamaluddin testified on vaccine spending by the government.

In November last year, Muhyiddin revealed that the government was spending RM3 billion to immunise 6.4 million Malaysians - a whopping RM468.75 per person.

Muhyiddin's administration enforced an emergency two months later, where, among others, the government withdrew RM5 billion from the National Trust Fund (Kwan) to finance the vaccination programme.

Accessing Kwan using emergency laws allowed the government to bypass Parliament's approval for the funding.

Khairy's testimony to the PAC revealed the "RM468.75 per person" price tag to be untrue.

Instead, he explained that the government's revised goal of vaccinating 82.8 percent of the population cost RM2.05 billion in vaccine procurement or RM77.35 per person.

"The Belgium one was RM1.38 billion (for) 16.75 million (people) which is RM82.40 per person. So, ours is cheaper," Khairy said.

Belgium was used as an example during the hearing because a Belgian minister had leaked EU's Covid-19 vaccine pricing just a month before Khairy testified, giving a glimpse of vaccine costs, which were hidden behind no-disclosure agreements (NDAs).

Khairy delved into vaccine costs from different makers to the PAC, but that part was redacted due to the NDA.

Public Accounts Committee chairperson Wong Kah Woh

Khairy: I checked with the Prime Minister's office (at the time). He misspoke.

Wong Kah Woh (PAC chairperson, Pakatan Harapan-Ipoh Timur): Okay. That will clear the air on this part. If we were to divide (the sum), a simple calculation comes to RM468.

Khairy: Yes. I understand, sir. He misspoke. In this context (vaccine procurement), and only in this context, the science, technology, and innovation minister supersedes that of the prime minister.

Vaccine pricing

According to the PAC's press release yesterday, the PAC was generally satisfied that the procurement of vaccines was in line with Finance Ministry procedures.

However, the PAC was unhappy that the government paid a premium of around 16.78 percent to 18.12 percent to expedite delivery of the Sinovac vaccine.

"The PAC is of the opinion that the government ought to have insisted that the price stayed the same as stated in the agreement," the PAC said.

The government procured 14.4 million doses of the Sinovac vaccine in four separate batches - first in March, twice in May, and again in July.

Although parts of the Hansard was redacted due to the NDAs, it was clear that each batch came with different pricing.

Public Accounts Committee member Wong Shu Qi

Wong Shu Qi (Harapan-Kluang): Honourable minister. With regard to Sinovac, what is the additional cost to order the finished product?

Khairy: As I explained this earlier (about redacted information), and then it went up to about (redacted). That was the premium we had to pay to accelerate the vaccination programme.

I explained to the cabinet that if we wanted to expedite the programme... we have to pay a premium and that was agreed by the cabinet. We wanted to accelerate things. If not, we had to wait until October.

Pharmaniaga's vaccine supply

At one point, Khairy agreed with the PAC's suggestion that Pharmaniaga, which was supposed to supply the "fill and finish" Sinovac vaccines, had delayed deliveries for April until June.

Khairy explained that the government had engaged Pharmaniaga as a Sinovac supplier because it was supposed to be cheaper as the company could handle the bottling of the vaccine in Malaysia, as opposed to China.

Pharmaniaga is a government-linked company. Its majority shareholders are Boustead Holdings Bhd and Lembaga Tabung Angkatan Tentera (LTAT).

Once Pharmaniaga had fulfilled its contractual obligations to the government, the company was allowed to sell Sinovac vaccines to the private market, which, the PAC ultimately concluded, was being sold at a price on the high side.

During the July 27 PAC hearing, Khairy said Pharmaniaga had proposed a retail price of RM130 per Sinovac dose for sale to the private market beginning Aug 1.

At the time of writing, the government has not set a ceiling price for the private Covid-19 vaccine market.

Armed with the knowledge of the price which the government paid for each Covid-19 vaccine dose, which was redacted, PAC chairperson Wong remarked that the proposed retail price was high, to which Khairy agreed.

Wong: (Redacted) this is a national service. I believe even for Pharmaniaga, RM260 (retail price) is too high.

Khairy: In my view right now, it is on a high side. We'll have to review (the pricing) at the Special Committee On Covid-19 Vaccine Supply (JKJAV) and understand the cost input for Pharmaniaga, which included logistics, delivery and so forth.

The Public Accounts Committee (PAC)

The PAC is a powerful bi-partisan committee that scrutinises government spending. It can summon witnesses, including top government officials, for hearings.

Although the hearings are held behind closed doors, unlike normal parliamentary proceedings, the Hansard (official meeting records) is appended to PAC reports, which are tabled in the Dewan Rakyat.

To access the PAC's report titled "Covid-19 vaccine procurement and utilisation under the Science, Technology, and Innovation Ministry, Health Ministry and Finance Ministry", click here. - Mkini