CAG report claims Kerala government overpaid for PPE kits by 300 percentage during COVID-19 pandemic

A Comptroller and Auditor General (CAG) report revealed Kerala's health department spent Rs 10.23 crore extra on PPE kits during the pandemic, buying them at 300% higher prices than market rates.

Thiruvananthapuram: A report by the Comptroller and Auditor General (CAG) has revealed a significant discrepancy in the Kerala state health department’s purchase of Personal Protective Equipment (PPE) kits during the COVID-19 pandemic. According to the report, the state government incurred an additional expenditure of Rs 10.23 crore, as PPE kits were purchased at prices 300% higher than the market rate.

The CAG report details that on March 28, 2020, PPE kits were bought for Rs 550 each. However, just two days later, on March 30, a different company sold the same kits for Rs 1550, marking a price hike of Rs 1000 within a short span. The report highlights that a company offering PPE kits at a much lower price was overlooked, and the government advanced the entire payment to San Pharma, which supplied the higher-priced kits.

This transaction occurred when KK Shailaja, a member of the CPM Central Committee, served as the Health Minister. Earlier, Asianet News had reported on the widespread allegations of corruption regarding the PPE kit purchases.

The government has faced criticism for placing orders at inflated rates, despite four institutions, including three regular suppliers of the Medical Services Corporation, offering to supply the kits at lower prices. The ruling leadership had defended the purchases, citing the urgency of the situation during the pandemic and presenting it as an emergency measure.