KUALA LUMPUR – There are conflicting testimonies from the Health Ministry and Pharmaniaga Logistics Sdn Bhd (PLSB) on warranties for 136 ventilators purchased by the latter for the ministry during the Covid-19 pandemic, a Public Accounts Committee (PAC) report shows.
Inconsistent information from the ministry and PLSB led to PAC being unable to verify the existence of a warranty for all the ventilators, PAC noted in its report on the government’s Covid-19 outbreak management.
It was earlier reported that of the 136 procured, 104 were inoperable, and PAC found that no party could be held accountable because there was no written agreement between the Health Ministry and PLSB on the procurement.
“PAC found that there was a discrepancy in evidence (furnished by) the Health Ministry and PLSB on the existence of a warranty for all 136 ventilator units.
“A review of the price quotation document submitted by PLSB to PAC shows that the warranty is stated by the supplier.
“However, PAC found that the document did not comprise all 136 ventilators and there was no acknowledgement of receipt,” the committee said in its report, released on Monday.
PLSB is a fully owned subsidiary of the pharmaceutical company Pharmaniaga Bhd, a government-linked company.
According to PAC meeting transcripts, Dr Mohamed Hirman Abdullah, the Health Ministry’s medical department division senior principal assistant director, confirmed that there was no warranty when PLSB purchased the ventilators.
The cabinet was first informed of the need for 800 ventilators in March 2020. The 136 units were delivered in April and May at a cost of RM24.07 million. Problems with using the ventilators were made known by the ministry to PLSB in early June.
Hirman said warranties were only later on provided by PLSB exclusively for ventilator units, which were found to require upgrading, and they only came about after a price negotiation for procurements during a meeting held on September 1, 2020, between the Health Ministry and PLSB.
“At that time (after the ventilators reached Malaysia), between May and June, there was no warranty. No documentation.
“There (was) no warranty given by… when PLSB bought from China, there (was) no warranty given from the supplier, no,” Hirman was recorded saying in the transcripts when quizzed by PAC member Wong Shir Yee.
When questioned on the existence of warranties “six months after” the units arrived, Hirman said that the ministry could not utilise the warranties – even if they existed – as there was no local distributor for the vendors.
“The ventilators were supplied from manufacturers in China. Then they were sent to the hospitals (here). There is no local distributor.
“When there is no local distributor, even though the warranty is there, it cannot be done. Because there is no local distributor. That is why I think the price negotiation was done taking into account the need for someone to maintain (the ventilators),” he said.
During separate proceedings later on August 22, former Health Ministry secretary-general Datuk Seri Dr Chen Chaw Min said the lack of warranty in PLSB’s procurement of the ventilators was due to the desperate conditions at the time during the pandemic.
“There was no warranty written because – actually, we begged to buy from them (China). It was not that they wanted to sell. We were begging, ‘Please sell to us if these are the specifications that you have’,” Chen said.
PLSB: Warranty is between government and suppliers
On the other hand, PLSB chief operating officer Mohamed Iqbal Abdul Rahman told the PAC on September 21 that there is a warranty for the ventilators, as shown in the purchase order and price quotation documents. The warranty is between the Malaysian government and suppliers, he said.
PLSB, he added, only managed the delivery of ventilators to public health facilities here and contacted suppliers over the warranty of unusable units.
The task of contacting suppliers was then passed on to IDS Medical Systems (M) Sdn Bhd (IDSMED), a company recommended by PLSB to the Health Ministry to, among others, audit and upgrade the ventilators.
On September 14, Iqbal told the PAC that while PLSB had attempted to directly contact suppliers to secure a warranty, some suppliers were unresponsive, and PLSB could not confirm the operating status of others.
“IDSMED had first contacted the suppliers. Suppliers may not be the manufacturers. They tried with the suppliers, if the suppliers said okay, I’ll manage, then they will manage,” Iqbal told the PAC inquiry.
“Otherwise, they went back to the manufacturers. Some of the manufacturers said, if you have gone through this channel, I will not entertain,” Iqbal said.
Wee Ka Siong helped with China contact
Meanwhile, then transport minister Datuk Seri Wee Ka Siong, at the time of the procurement, is also named in the PAC report as the figure who aided the procurement of the ventilators from China.
He is on record saying during proceedings on September 21 that the Health Ministry should not be blamed for troubles with the faulty ventilators, as the situation during the pandemic was dire, with public hospitals borrowing ventilators from private hospitals.
Wee, who is Ayer Hitam MP, said that pressing conditions during the pandemic prompted him to aid in the Health Ministry’s attempts to secure a contract for the supply of ventilators from China.
He denied any knowledge of defects in the ventilators, stressing that his part in the process was merely to help the Health Ministry find a supplier and provide logistical aid.
“We were looking (for ventilator suppliers) together. Many said they could do it, but at that time, established companies were shut down (because of the pandemic). (Companies in) Europe were closed, the only country (left) was China, you had no choice. We had to do it.
“I felt called on to save lives by helping. Once the units arrived, the story was closed because my task was done. I don’t know about voltage issues because I am not the technical person in this matter,” Wee added.
He also said that he had entrusted his then-senior private secretary, Wong Lee Yen, to represent him during discussions between the Health Ministry and PLSB with regard to MAB Kargo Sdn Bhd’s (MASKargo) role in the logistics and delivery of the ventilators.
“If I’m not mistaken, there were talks with MASKargo’s logistic team because we had to arrange for when the units arrived. I asked him (Wong) to handle it because I was in meetings.
“Wong’s role was to obtain receipts (of payment to China’s ventilator suppliers) and send them there as proof of payment before we could decide on a delivery date. That was very critical,” Wee said.
Yesterday, graft watchdog Transparency International Malaysia and the Malaysian Medical Association raised their concerns about PAC’s findings on the lack of proper documentation behind the procurement of faulty ventilators.
Bandar Kuching MP Dr Kelvin Yii, who is also special adviser to Health Minister Dr Zaliha Mustafa, said those responsible for procuring unusable ventilators without a purchase agreement should be identified and held accountable.
Yii also said the Malaysian Anti-Corruption Commission should step in to investigate if there was undue influence in the selection of suppliers from China. – November 1, 2023
