Kwara State government awarded the sum of N34.753 million for the supply of bed sheets to hospitals in 2020. It was awarded in four lots and Dataphyte’s review of the state’s Open Contracting Portal shows contract ambiguity, misplaced priority, and contract irregularities.
The first of the lots had contract code ocds-ilp7ty-21-moe-000d2. Awarded for N7,765,000 for the supply of 1000 bed sheets. This gives an estimated unit cost of N7,765 per bed sheet.
The second lot was for N9.350,000 with a contract code of ocds-ilp7ty-21-ssg-00169 for the supply of 1,000 pieces of bedsheets at a unit cost of N9,350 per bed sheet.
It awarded the third lot with contract code of ocds-ilp7ty-21-ssg-0015a for N9,137,500 for the supply of 1,000 bed sheets at N9,137.50 per bed sheet.
N8,500,000 was the contracted amount for the fourth lot awarded with contract code ocds-ilp7ty-21-ssg-00187. This gives a breakdown cost per unit of N8,500 per bed sheet.
They awarded all these contracts to Tan Fashion and Lifestyle to supply a total of 4000 bed sheets to isolation centres for COVID-19 response.
How Much is a Hospital Bed Sheet?
The prices of a hospital bed sheet vary in the market. A set of poly-cotton fitted bed sheets for hospitals is sold for between $3 – $5. This gives a unit price of N2,102.30 at $5 per sheet with a minimum supply quantity of 100 sheets. This supplier provides extra customising services for quantities over 500 at no extra cost.
A 190cm by 90cm (6.23ft by 2.95ft) bed sheet size by another seller goes for 180 Indian ruby, which gives a unit cost of N948.6 per sheet.
On the higher side, the price of plain blue or white bed sheets goes for N4500 per piece on yaoota.
Locally, Onyekachi Onyekwere, a dealer in bedding materials, says currently, the two variations of bedding materials cost N1200 and N800 per yard. A hospital bed will need 2.5 yards for the bedsheet and pillowcase. This gives an estimate of N3300 per bedsheet at N1200 per yard and N2300 at N800 per yard (including the cost of sewing).
With the total sum of N34.753 million awarded for the supply of 4,000 pieces, Tan Fashion and Lifestyle provided each bed sheet at an average of N8.688.13 per bedsheet
This amount is N4188.13 higher than the most expensive bed sheet on the market, a 48.2% difference between the contract amount and the most expensive bed sheets from the market survey at N4,500.
Considering the supply volume, if Tan Fashion & Lifestyle did direct production, the maximum production cost will be N3500 per sheet. However, the price they supplied these bed sheets was N5188.13 higher and a 67.46% increase.
Company Inactive and Contract Irregularities
Tan Fashion & Lifestyle ltd. is registered as a company with the Corporate Affairs Commission (CAC) with registration number RC – 875979. The company was registered in 2010 with its address at 34 Norman Williams street, Ikoyi Lagos.
However, the company is inactive and so not qualified to be contracted or awarded contracts. Although some states made special provisions for SMEs impacted by the pandemic, the criteria of qualification is unclear across states who have mentioned this provision and also it is unclear if Kwara State has these provisions.
CAC requires all companies registered to submit tax returns and pay their annual dues for at least two years. Thus, companies that fail to comply with this requirement are rendered inactive by the commission. These companies are not qualified to be awarded contracts according to Sections 417 – 424 of the Companies and Allied Matters Act of 2020.
Therefore, awarding contracts to Tan Fashion & Lifestyle by the Kwara State government contravenes Section 43 of the Public Procurement Act.r
The contracts awarded by the state government also have irregularities aside from the different prices quoted on the award of similar procurements. According to the contract description, it’s a health-related project which should be awarded by the state Ministry of Health. However, the first lot was awarded by the Kwara State Ministry of Energy while the Office of the Secretary to the Government of Kwara State awarded the remaining three lots.
Mr. Segun Elemo of the Paradigm Leadership Support Initiative (PLSI) described the irregularities as attempts to circumvent procurement laws. The Procurement Act of 2007 states the award limits for each level of chief executives. However, these executives break contracts into lots so that the amount will be within their approval limit and will not have to go through the process for approval.
The Executive Director of PLSI also noted that the procurement act is to enhance procurement practices but that is not the case, just like the IPASS, which has not enhanced financial practices.
Mr Elemo observed that issues with procurement, where a contract will be awarded by a ministry which does not have any related function, breed inefficiency in the procurement process as there will not be a proper evaluation of the work to enhance standard compliance.
He concluded by saying until chief executives respect and adhere to procurement laws in the country, we will keep experiencing procurement issues.