Wednesday, January 1, 2025

State to pay Mike Macharia Sh. 1.6 billion for cancelled deal

State to pay Mike Macharia Sh. 1.6 billion for cancelled deal

The government has been ordered to pay local businessman Mike Macharia Sh. 1.6 billion for a cancelled tender with the Ministry of Health.

This order has been issued by retired judge Aaron Ringera who now serves as an arbitrator. According to Ringera, Macharia will be paid the huge amount of money because the government was at fault when it terminated a contract to wire 98 government hospitals.

In this contract, Macharia’s Seven Seas Technology firm had been contracted to provide the technology component of the Managed Equipment Service (MES).

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The Healthcare Information Technology (HCIT) is a component of the Sh. 62 billion MES project by the government in realisation of outgoing President Uhuru Kenyatta’s Universal Health Coverage (UHC) plan.

The project was awarded to Seven Seas Technologies Limited on October 2, 2017, but it was cancelled on November 18, 2019 without notice or show-cause.

It was meant to connect all public hospitals from the remotest part of the country to a central database.

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This would have seen the deployment of teleradiology, which would have allowed doctors in top referral hospitals such as Kenyatta National Hospital (KNH) to read X-rays, CT scans, MRIs and other medical images for the treatment of patients in upcountry and remote facilities.

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“I have found that the Second respondent (Ministry of Health) was in breach of both payment obligations under the contract and the obligation to provide a government letter of support. Both defaults are material breaches of the Second respondent’s contractual obligations,” retired Justice Ringera ruled.

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“It was the Ministry of Health’s default in providing the claimant with a government letter of support that prevented Seven Seas from achieving completion of the project.”

The award is in inclusive of Sh. 1.59 billion for breach of contract, loss of profits and costs incurred after the cancellation of the tender. Im addition, Macharia’s firm will receive an additional Sh. 52 million for costs related to the suit

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