The government sustained over RM13 million in losses after 108 out of 136 new ventilator machines it ordered in 2020 could not be put to use by the Health Ministry.
This is according to the second series of the Auditor-General's Report 2021, which was released to the public earlier today.
The machines, which were ordered from overseas manufacturers through an unnamed local company, were meant to beef up government hospitals during the Covid-19 pandemic.
After ordering the 136 ventilators for a price tag of RM20.1 million under emergency allocation, the ministry later found out that some of them were incompatible with their use, said the report prepared by the National Audit Department (NAD).
Following this, the government had to fork out another RM3.97 million for upgrading works by the same company, making the total costs for its ventilator procurement rise to RM24.07 million.
However, despite the upgrades, NAD's audit of the Health Ministry’s Covid-19 procurements revealed that only 28 of the ventilators were considered safe for use on patients.
"Out of the 108 ventilators, 15 have been returned to their manufacturer and are going to be replaced. While the other 93 did not pass technical specification test, and performance and quantitative tests," the report said.
According to the audit, Health Ministry in its feedback to the audit finding stated that during the procurement process, they could only evaluate the ventilators via brochures and catalogues provided by the manufacturers.
This was due to the pandemic, which saw the country's borders closed.
The limitation had caused the ministry to only be able to verify the ventilators' specifications after they were delivered.
NAD also found that the ministry could not claim compensation from the company, identified in the report only as company 260790-T, as there was no agreement signed between them.
"Audit exercise found that up to September 2022, 15 of the 108 ventilators were in the process of being replaced by their overseas manufacturer.
"Based on an interview with Health Ministry, they could not claim compensation for the ventilators from company 260790-T because there was no letter of appointment between the ministry and company, and this procurement was done under the company's corporate social responsibility.
"Based on NAD's calculation, the amount of losses from the 93 ventilators which could not be used (minus 15 that are being replaced by the manufacturer) is at RM13.07 million." - Mkini
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