BHUBANESWAR: The Comptroller and Auditor General (CAG) of India has exposed chinks in procurement of drugs and medical consumables by Odisha State Medical Corporation Ltd (OSMCL), undue favouritism to suppliers, inordinate delay in tendering for drugs, medical equipment, and procurement at an unreasonable price.
The CAG has rapped the Health and Family Welfare Department for failing to monitor and pointed out that the Government was unsuccessful in providing an unbroken supply of essential drugs to patients in public health institutions as per its own prescribed Essential Drugs List.
The audit was conducted covering the period 2016-19 with the objective of examining the economy and efficiency in procurement and distribution of medicines and essential equipment, instruments and furniture (EIFs) along with evaluation of the adequacy of quality control measures.
Odisha government had launched the Niramaya scheme in 2016 under which patients are being provided drugs free of cost at all public health facilities in the state. The OSMCL is an independent agency of the Health department entrusted with procurement of the drugs, medical consumables, and equipment.
The audit revealed that there was an inordinate delay in finalisation of annual procurement plans for drugs, medical consumables EIFs. OSMCL could supply only 49 per cent (pc) of the indented/approved quantity of drugs and medical consumables to health institutions during 2016-19. Non-supply of indented quantity resulted in non-availability of essential drugs in health facilities.
"The health institutions procured locally and incurred excess expenditure owing to the delay in finalisation of the process. The checked health institutions had incurred excess expenditure of Rs 98.12 lakh (44 pc) in procuring medicines worth Rs 2.24 crore during 2018-19. Similarly, OSMCL could procure only 43 per cent EIF against the approved quantity during 2016-19. As of June 2019, 19 pc of the procured EIF had not been installed and were lying unutilised with different indenting agencies. Ineffective monitoring of indents, distribution, consumption, stock position of drugs through e-Niramaya software led to the expiry of drugs valued at Rs 4.18 crore during April 2017 to May 2019," the report stated.
The CAG said lack of monitoring at the level of Health and Family Welfare department/ State Drug Management Unit/ OSMCL, the health institutions ultimately resulted in a shortage of essential drugs and wastage of government resources due to expiry of unused drugs, supplied in excess.
As per contract conditions, OSMCL should de-recognise/blacklist the defaulting suppliers for non-performance of contract provisions, non-supply/part supply of the ordered quantity followed by forfeiture of earnest money deposit, and performance security of the said bidder/ supplier.
The audit, however, observed that the agency had not recovered/forfeited performance securities of suppliers amounting to Rs 47.42 lakh in respect of 30 out of 252 purchase orders (POs) issued during 2016-19 against which there was no supply. OSMCL had, however, not taken other penal actions like de-recognition/blacklisting or cancellation of POs, against the defaulting firms.
Surprisingly, 17 firms, which were ‘nil’ suppliers in previous years were unduly favoured by OSMCL by the award of further contracts valued at Rs 55.45 crore in subsequent years.
Though the state level equipment management committee (SEMC) had approved the list of EIF and specification required for Robotic Surgery at SCB MCH, Cuttack in April 2016 for conducting complex and advanced surgical procedures and Director of Medical Education and Training (DMET) provided Rs 12 crore to OSMCL in September 2016 for procuring the equipment, the OSMCL did not take any action for the procurement even after three years of approval. Non-availability of robotic surgery facility denied improved patient care, surgical skill, and teaching standard in SCB MCH, the audit found.
The CAG audit has also revealed procurement of sanitary napkins at higher prices under the KHUSI scheme and undue favouritism to firms for procurement of spectacles under Sunetra Yojana.