The findings have provided fresh ammunition for the Opposition UDF led by the Congress, which has accused the CPI(M)-led LDF government of corruption and mismanagement.
Published Jan 22, 2025 | 11:31 AM ⚊ Updated Jan 22, 2025 | 11:31 AM
A person wearing PPE. (iStock)
The Comptroller and Auditor General (CAG) of India tabled a scathing report in the Kerala Assembly on Tuesday, 21 January, exposing financial irregularities in the state government’s management of the Covid-19 pandemic and critical deficiencies in the state’s healthcare infrastructure.
This comes at a time when the state government is lauding its healthcare achievements and using its pandemic response as a key part of the narrative.
The findings have provided fresh ammunition for the Opposition UDF led by the Congress, which has accused the CPI(M)-led LDF government of corruption and mismanagement.
According to the CAG report, the Kerala Medical Services Corporation Limited (KMSCL), responsible for pandemic-related procurements, paid 100 percent of the purchase value — ₹2.32 crore — as an advance to M/s San Pharma for 15,000 Personal Protective Equipment (PPE) kits priced at ₹1,550 per unit, the highest rate quoted by any supplier.
This advance payment was in blatant violation of the State Level Crisis Management Group’s (SLCMG) directive, which limited advance payments to 50 percent of the purchase value.
While the state government defended its actions by stating the advance was part of a larger order for 50,000 PPE kits, the CAG found this argument untenable, as purchase orders were issued only for 15,000 kits initially.
The report emphasised that the decision to grant full payment to a new supplier, without prior verification of its product, was a glaring violation of norms.
The CAG also flagged the procurement of PPE kits at rates as high as 300 percent above the government-approved rate of ₹545 per unit. Despite offers from established suppliers to provide PPE kits at lower rates, the KMSCL opted for firms quoting significantly higher prices, resulting in an additional expenditure of ₹10.23 crore.
One instance cited in the report involved M/s Anitha Texcot (India) Pvt Ltd, which offered to supply PPE kits at ₹550 per unit. The KMSCL placed an order for only 10,000 kits with the firm, while other suppliers quoting rates between ₹800 and ₹1,550 per unit were given larger orders, ranging from 15,000 to 200,000 kits.
The order with Anitha Texcot was later cancelled, allegedly due to delayed supply, even though no time frame had been stipulated in the Letter of Intent. Meanwhile, suppliers quoting higher prices were allowed longer delivery periods without penalty.
The Opposition seized the opportunity to attack the government, with Leader of the Opposition in the state Assembly VD Satheesan stating that the report validates their long-standing claims of large-scale irregularities and misuse of public funds during the crisis.
In a strongly worded press release, Satheesan said, “The report confirms that the government, instead of prioritising lives, used the pandemic as an opportunity for corruption. The chief minister and former Health Minister KK Shailaja must answer to the people.”
The Opposition claimed that the former health minister had earlier admitted the purchase decisions had been made with the chief minister’s approval.
“This report demolishes the carefully crafted PR [Public Relations] image of the government as a pandemic saviour,” the Leader of the Opposition added.
The Lokayukta is currently reviewing a case regarding these alleged irregularities, while the Kerala High Court recently dismissed arguments seeking to quash the case.
The Opposition has vowed to intensify its legal battle and expose what it calls the “government’s looting of public funds during a disaster.”
However, Shailaja defended the decisions as necessary due to the unprecedented crisis, citing global price surges and supply chain disruptions during the pandemic.
Responding to recent Opposition allegations and reports of inflated prices, Shailaja clarified that the issue had been addressed earlier in the Kerala Assembly and by the chief minister during the second Pinarayi Vijayan government’s tenure.
“The government acted responsibly under unprecedented circumstances. There was a severe shortage of PPE kits during the pandemic, and prices surged globally. Out of lakhs of kits procured, only a few were purchased at higher prices due to quality considerations and urgent demand,” she told media.
Shailaja emphasised that the Opposition had already raised the matter before the Lokayukta and she clarified the stance. “The government will address the issue appropriately,” she added.
Meanwhile, CAG urged the government to establish clear guidelines for procurement during crises, emphasising transparency, accountability, and efficient price control.
It stressed the need for a robust public procurement system to prevent financial irregularities and ensure effective crisis management in the future.
The CAG also painted a troubling picture of Kerala’s healthcare system, often celebrated as a model for the country. The report scrutinised the sector’s performance from 2016 to 2022, uncovering critical gaps in infrastructure, manpower, and regulatory compliance.
A key finding was the severe shortage of doctors, particularly specialists, in hospitals under the modern system of medicine.
Tertiary hospitals under AYUSH also suffered from similar deficiencies.
Test-checked hospitals revealed acute shortages of nurses, pharmacists, and lab technicians, with the doctor-to-population ratio most unfavourable in Kozhikode and Malappuram districts.
The strain on limited human resources compromised the delivery of healthcare services and adversely affected patient satisfaction. The shortage of Accredited Social Health Activists (ASHA) was another critical concern.
The deficit ranged from three percent to 33 percent in 13 out of 14 districts, impacting grassroots-level healthcare delivery. The audit verified the availability of ASHA as of March 2022 and noticed a shortage in all the districts except Wayanad
Family Health Centres under the ambitious Aardram Mission also failed to meet their objectives due to inadequate infrastructure and manpower. This undermined the mission’s aim of providing accessible and augmented healthcare services to the public.
The audit highlighted that (Indian Public Health Standards) IPHS-mandated essential services were unavailable in several hospitals. Insufficient pathological services and delays in procuring and maintaining critical medical equipment exacerbated the situation, leaving patients without essential diagnostics and treatments.
The CAG also criticised the policy of subjecting only 10 percent of drugs to quality checks, which led to lapses in ensuring the safety of vital medicines. Additionally, the implementation of centrally sponsored health schemes was found unsatisfactory, reflecting inefficiencies in utilising federal assistance.
The state’s regulatory mechanisms were deemed inadequate, with the Clinical Establishments Act failing to achieve its objectives of standardising facilities and services.
Instances of unlicensed blood banks and radiographic equipment being operated without Atomic Energy Regulatory Board clearance highlighted lapses in safety and compliance. Furthermore, existing bio-medical waste disposal facilities were under significant stress, necessitating urgent expansion.
The findings cast a shadow on the state’s oft-celebrated health sector achievements.
While Kerala has consistently projected itself as a model for public health, the CAG report underscores the need for urgent reforms to bridge critical gaps.
The deficiencies not only challenge the state’s commitment to United Nations (UN) Sustainable Development Goal 3 (good health and well-being) but also highlight the pressing need to revamp policies to deliver quality and equitable healthcare services.
(Edited by Muhammed Fazil.)
