Two major aid agencies have now threatened to withdraw up to Ksh 400 billion that has been earmarked for Kenya because of the KEMSA procurement scandal.
Sources say both USAID and Global Fund have written to the government expressing their concerns over the alleged corruption.
The two key donors are threatening to withdraw funds in support of HIV/AIDs, Malaria, Nutrition, Tuberculosis, family planning, and maternal and child health for a period of three years.
The agencies have expressed their concerns over KEMSA’s procurement as well as management and implementation of the funds given to it.
In a letter written to the government, the donors said,” we have noted several areas of concerns in the management of procurement at KEMSA as well as in the management of Global Fund grants.”
At the same time, the scandal is also causing internal crisis as KEMSA stands to lose a total of Ksh2 billion as it struggles to dispose of the overpriced PPEs and other medical items in its warehouses.
The medical agency is said to have failed to find buyers that were allegedly purchased at an inflated price and now most of them would be about to expire.
Sources within the KEMSA board say the agency is holding a stockpile of over Ksh6.4 billion. The board now wants a go-ahead from the Afya House to sell off the stock at a market value of around Ksh4 billion to gain its initial capital.
Sources also say the board also wants a recapitalization of Ksh5 billion to caution itself from the loss that should be occasioned should the Ministry of Health agree to it.
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The medical agency is currently a financial liability of over ksh8 billion out of which Ksh5 billion was already committed.
The board has linked the crisis with the procurement that was allegedly done without its approval or that of the Ministry of Health.
The board is now considering sending home more officials who are involved in the graft as KEMSA continues unraveled.
