THE REPUBLIC OF UGANDA

OFFICE OF THE AUDITOR GENERAL

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OFFICE OF THE AUDITOR GENERAL

P.O.Box 7083, Kampala, Tel: +256 414 344 340 Fax: +256 414 345 674 E-mail: [email protected]

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH VALUE FOR MONEY AUDIT REPORT ON FACILITIES UNDER THE UGANDA HEALTH SYSTEMS IMPLEMENTATIONSTRENGTHENING PROJECT OF THE MARKET(UHSSP), INFRASTRUCTUREMINISTRY OF HEALTH

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA SYSTEMS STRENGTHENING PROJECT (UHSSP), MINIST RY COMPONENT OF THE MARKETS AND AGRICULTURAL TRADE IMPROVEMENT PROGRAMME A REPORT BY THE AUDITOR GENERAL

A REPORT BY THE AUDITOR GENERAL

VALUE FOR MONEY AUDIT REPORT ON THE IMPLEMENTATION OF THE EXPRESS PENALTY SCHEME (EPS) VALUE FOR MONEY AUDIT REPORT ON THE IMPLEMENTATION OF THE EXPRESS PENALTY SCHEME (EPS) 1 MARCH 2015 1 BY UGANDA POLICE FORCE | A REPORT BY THE AUDITOR GENERAL DECEMBER,BY UGANDA POLICE2015 FORCE | A REPORT BY THE AUDITOR GENERAL

THE REPUBLIC OF UGANDA

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH

A REPORT BY THE AUDITOR GENERAL

DECEMBER, 2015

AUDITORAUDITOR GENERAL’S MESSAGE GENERAL

31st December 2015

The Rt. Hon. Speaker of Parliament Parliament of Uganda Kampala

VALUE FOR MONEY AUDIT REPORT ON THE RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH

In accordance with Article 163 (3) of the Constitution of the Republic of Uganda 1995 (as amended), I hereby submit my report on the value for money audit undertaken on the Renovation and Construction of Selected Health Facilities under the Uganda Health Systems Strengthening Project, Ministry of Health.

My office intends to carry out a follow – up at an appropriate time regarding actions taken in relation to the recommendations in this report.

I would like to thank my staff and the Consultants who undertook this audit and the staff of Ministry of Health for the assistance offered to my staff during the period of the audit.

John F. S. Muwanga AUDITOR GENERAL TABLE OF CONTENTS TABLE OF CONTENTS

6 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL TABLE OF CONTENTS

LIST OF TABLES...... ii LIST OF ACRONYMS AND ABBREVIATIONS...... iii EXECUTIVE SUMMARY...... iv

CHAPTER ONE INTRODUCTION...... 2 1.1 Background...... 2 1.2 Motivation...... 2 1.3 Description of the audit area...... 4 1.4 Audit objective...... 6 1.5 Audit scope...... 6

CHAPTER TWO AUDIT METHODOLOGY...... 8 2.1 Sampling...... 8 2.2 Data collection...... 8

CHAPTER THREE 3.1 Roles and responsibilities of key players...... 11 3.2 Process description...... 13

CHAPTER FOUR FINDINGS, CONCLUSIONS AND RECOMMENDATIONS...... 18 4.1 Planning...... 18 4.2. Procurement...... 24 4.3 Implementation and progress of works...... 25 4.4 Post construction preparedness for facilities renovated/ Constructed under UHSSP...... 33 APPENDICES APPENDIX I:UHSSP technical secretariat organogram...... 35 APPENDIX II: Documents reviewed...... 36 APPENDIX III: Interviews conducted...... 37 APPENDIX IV: Procurement process...... 38 APPENDIX V: Summary of findings per individual hospitals...... 39

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS i STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL LIST OF TABLES

Table 1: Contract amounts for the 9 health facilities under review...... 6 Table 2: Variation orders per health facility...... 20 Table 3: Variations due to inadequate topographical surveys per hospital...... 21 Table 4: Variations...... 22 Table 5: Contract execution period and status of Implementation of works...... 25 Table 6: Criteria for UPV tests (BS 1881, 1983)...... 30 Table 7: Showing results of Non-destructive tests using Rebound Hammer...... 30 Table 8: Selected Results of Non-destructive Tests using UPV...... 31 Table 9: Operational capacity of health facilities under review...... 33

ii RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL LIST OF ACRONYMS AND ABBREVIATIONS

AWPs Annual Work Plans BoQs Bills of Quantities CC Component Coordinators DPC Deputy Project Coordinator EmONC Emergency Obstetric and Neonatal Care ESIA Environment and Social Impact Assessment FP Focal Person GH General Hospital HCIV Health Centre IV HIV/AIDS Human Immuno Virus/Acquired Immune Deficiency Syndrome ICT Information Communication Technology IDA International Development Association INTOSAI International Organization of Supreme Audit Institutions MoH Ministry of Health MTEF Medium Term Expenditure Framework NACME National Advisory Committee on Medical Equipment NDA National Drug Authority OAG Office of the Auditor General PAD Project Appraisal Document PC Project Coordinator PDE Procurement Disposal Entity PIP Project Implementation Plan PPDA Public Procurement and Disposal of Public Assets Authority PS Permanent Secretary RRH Regional Referral Hospital ToR Terms of Reference TWG Technical Working Group UGX Uganda Shillings UHSSP Uganda Health Systems Strengthening Project UNMHCP Uganda National Minimum Health Care Package UPV Ultra-Pulse Velocity USD United States Dollars VFM Value for Money

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS iii STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL EXECUTIVE SUMMARY

UHSSP was a five year project, which was established in 2010, commenced operations in February 2011, and was due to end on 31stJuly 2015 prior to receiving a 2 year extension. The project is jointly funded by the Government of Uganda (GoU) and the World Bank to a tune of USD 14.31 million and USD 130 million, respectively. The funding from the World Bank is through a loan obtained from the International Development Association (IDA)1.

The project has four components, namely: a) Improved Health Workforce Development and Management, b) Improved Infrastructure of Existing Health Facilities, c) Improved Leadership, Management and Accountability, and d) Improvement for Maternal, Neonatal and Family Planning Services2. The objective of the component for Improved Infrastructure of Existing Health Facilities was to improve physical infrastructure in terms of functionality and usage by providing minimum standards of quality health care services through the sub-components of; -(i) renovation of selected health facilities; (ii) provision of medical equipment; (iii) improved capacity for operations and maintenance; and (iv) strengthening the referral system3.

Owing to concerns over the progress of the implementation of the infrastructure facilities under the project, the Office of the Auditor General undertook a value for money audit on renovation and construction of selected health facilities under the UHSSP infrastructure component .The scope of the audit included health facilities constructed at Entebbe, Iganga, Nakaseke, Mityana, Kiryandongo, Anaka, Nebbi, Moyo General Hospital and Moroto Regional Referral Hospital.

KEY FINDINGS i) Planning and Needs assessment Through review of consultancy contracts, design reports and the works contracts for renovation and construction of the selected health facilities, it was revealed that design reports delayed by twelve (12) months. In addition, there were gaps in planning for the works especially in the areas of needs assessment, designs and cost estimation. Inadequate needs assessments were attributed to the contract manager for consultancy services for design of renovation and construction of health facilities not ensuring that all user needs were ascertained and incorporated in the architectural and engineering design process, resulting in various design changes and variation orders during the construction of the works. ii) Design and Cost Estimation The audit also revealed inadequacies in the designs issued at tendering stage leading to issue of BoQs to bidders that were inaccurate in some cases, hence increased quantities

1 UHSSP Project Appraisal Document, Page VII 2 UHSSP Project Appraisal Document, Page 8 3 UHSSP Project Appraisal Document Page 9 iv RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL during construction. of works at the health facilities; specifically At pre-implementation stage, commencement days were shifted from January the Client did not adequately 2012 to January 2014. This resulted in non-utilization review the designs and tender of donor-committed funds that have attracted a documentation prepared non-utilization penalty of USD 256,517.49. and submitted by the design v) Implementation and Progress of Works Consultant to establish The works that were scheduled to start in January accuracy and completeness. 2012 as per the approved plan were delayed for As a result, USD 1,234,850.15 approximately twenty-four (24) months. was incurred in variation costs The contracts for the works signed between the during project implementation MoH and the contractors provided for contract as at 30thOctober 2015. periods of 18 months for completion of works. iii) Cost Estimations for Renovation Accordingly, in the nine (9) health facilities under and Construction Works review, the works commenced between 6thJanuary Audit established that the and 28thFebruary 2014. Consultant did not provide It was established that even after commencement, design sheets/calculations the works still delayed by more than three (3) to enable assessment of months. At the time of audit in November 2015, the compliance with logical contract period for the nine projects (9) had elapsed, engineering design procedures yet works were still ongoing with the exception of as well as optimization of cost. 3 health facilities of Nakaseke, Moroto and Anaka The underestimation of costs for which had been substantially completed. the works at project appraisal vi) Post Construction Preparedness for Facilities led to a reduction in the scope Renovated/ Constructed under UHSSP Project of works as the project could A review of the needs assessment reports revealed not undertake the anticipated that for all the nine health facilities, there was need works in all the target sites of to increase staffing, staff housing, bed capacity and forty-six (46) health facilities. operational budgets, among other things, if the iv) Procurement of Works health facilities were to be effectively maintained Contractors and cater for delivery of the required health services. It was further noted that the procurement process for works contracts commenced KEY RECOMMENDATIONS twelve (12) months late and The Ministry of Health should: was completed twenty two(22) months beyond the planned i) Ensure that a review of user needs assessments is completion period of December undertaken at completed facilities to establish the 2011. This was attributed critical needs to be addressed in order to ensure to delays in commencing optimum utilization of the facilities handed over. the process on time due to ii) In view of the fact that additional health facilities are adjustments in scope of works still under renovation and construction, ensure that to fit into the available funding needs assessment for users have been incorporated 4 of USD 75.91 million . in the architectural and engineering designs process The failure by the project to in order to reduce unnecessary variations in costs procure contractors on time of renovation and construction. delayed the commencement iii) Ensure that for the continued renovation and of renovation and construction construction of the other health facilities adequate site investigations are undertaken. 4 Project Appraisal document page 51

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS v STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL iv) Ensure that in future proper planning is carried out and cost estimation for works at project appraisal are adequate. v) Ensure that design reports produced have design sheets and calculations to assess whether they are fully optimised. vi) Ensure that adequate measures are taken in respect of staffing and maintenance to be able to effectively operate and maintain the health facilities upon handover by the contractors.

OVERALL AUDIT CONCLUSION Ministry of Health has undertaken specific interventions to increase the availability and functionality of health facilities by renovation and construction of the nine health facilities at Entebbe, Iganga, Nakaseke, Mityana, Kiryandongo, Anaka, Nebbi, Moyo General Hospitals and Moroto Regional Referral Hospital. Inadequate planning and needs assessment resulted in design changes which necessitated contract variations leading to project delays throughout the contract implementation period .Generally the quality of works was relatively good except in a few instances where the quality of the concrete used was doubtful. For those facilities which have been completed, the Ministry will have to provide for necessary resources to effectively maintain and operate the constructed health facilities.

vi RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 1 CHAPTER ONE CHAPTER ONE

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 1 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL CHAPTER ONE

INTRODUCTION

1.1 BACKGROUND

The Uganda Health Systems Strengthening Project (UHSSP) is a project implemented by the Ministry of Health (MoH). UHSSP was established as an enabler to achieving the Uganda National Minimum Health Care Package (UNMHCP) with a focus on maternal health, new born care and family planning. This was to be achieved through improving human resource for health; improving physical health infrastructure; and management, leadership and accountability, for health service delivery5.

UHSSP was a five year project, which was established in 2010, commenced operations in February 2011, and was due to end on 31st July 2015 prior to receiving a 2 year extension. The project is jointly funded by the Government of Uganda (GoU) and the World Bank to a tune of USD 14.31 million and USD 130 million respectively. The funding from the World Bank is through a loan obtained from the international Development Association (IDA)6.

The project has four components, namely: a) Improved Health Workforce Development and Management; b) Improved Infrastructure of Existing Health Facilities; c) Improved Leadership, Management and Accountability; and d) Improvement of Maternal, Neonatal and Family Planning Services7. The objective of the component for Improved Infrastructure of Existing Health Facilities was to improve physical infrastructure in terms of functionality and usage by providing minimum standards of quality health care services through the sub- components of: -(i) renovation of selected health facilities, (ii) provision of medical equipment, (iii) improved capacity for operations and maintenance, and (iv) strengthening the referral system8.This audit focused on the sub-component of renovation of selected health facilities under the component of Improved Infrastructure of Existing Health Facilities.

1.2 MOTIVATION

Over the last 30 years, Government has struggled to achieve better health for the people of Uganda9. Physical access to health facilities (proportion of the population leaving within 5 km of health facility) is currently at 72% with all the 112 districts in Uganda either having a General

5 UHSSP Project Appraisal Document, Page 7 6 UHSSP Project Appraisal Document, Page VII 7 UHSSP Project Appraisal Document, Page 8 8 UHSSP Project Appraisal Document Page 9 9 Health Sector Development Plan 2015-2020, Page xii

2 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Hospital or Health Centre (HC) IV or appropriate buildings and equipment, including both. This however, includes some old transport and communication for a functioning and dilapidated infrastructure mainly referral system15. at General Hospitals (GHs) and some The dilapidation and sub optimal functionality of lower level health facilities10. health infrastructure in public health facilities across the country have greatly contributed to Whereas 72% of the households in deterioration of health services delivery in Uganda, Uganda live within 5km from a health both in terms of reach and quality and it is for this facility, utilization remains limited reason that the Ministry of Health (MoH) came up due to poor infrastructure such as with the Uganda Health Systems Strengthening accommodation for both staff and Project (UHSSP) to, among other things, address patients at health facilities which the challenges of infrastructure in the health affects service delivery. Rehabilitation sector16. and maintenance of buildings is not regularly done and the challenge of The UHSSP was conceived to primarily improve the accommodation for staff remains a physical functionality of the health facilities, through major reason for low staff numbers renovation and construction of hospitals, among especially in hard to reach areas11. other measures. As such, the sub-component Most hospitals in Uganda were built of renovation of selected health facilities was between 1930 and 1970 and no longer allocated 52.6% (USD 75.91 million) of the total conform to current demands and project budget (USD144.31 million) to carry out service standards. Over the years, renovation and construction works in 46 health insufficient attention was paid to facilities17. their maintenance; and the majority are dilapidated and in poor physical Although the Project is in its final year of condition12. implementation, the Value for Money Audit on acquisition and utilization of equipment under The proportion of facilities in Uganda UHSSP by the Office of Auditor General for the providing appropriate emergency year 2014/15 indicates that construction and obstetric care is also still low, and renovation works were ongoing in only nine (9) out so is access to postnatal care13. of the targeted forty-six (46) facilities. The report Similarly, the maternal mortality also states that a number of equipment supplied rate for Uganda is still at 435 deaths under the project remained un-utilized due to per 100,000 live births against the inadequacies in space and safety at the beneficiary Millennium Development Goals target facilities. Furthermore, the Auditor General in his of 131 deaths per 100,000 live births Annual report 2013/14 cited procurement delays for Uganda by 201514. Slow progress in for civil works and non-appointment of contract addressing maternal health problems managers to supervise the implementation of in Uganda is due to lack of: - human contracted works. resource, medicines and supplies, 18.The Annual health monitoring report noted a 10 Health Sector Development Plan 2015-2020, number of challenges in the implementation of Page 39 the project, for instance, delayed implementation 11 Health Sector Strategic plan 1 06-2010, page 19. 53 of the works and inadequate scope of works 12 Project Appraisal Document, Page 3 15 UHSSP Project Appraisal document, 2010, page 3 13 UHSSP Project Appraisal document, 2010, 16 UHSSP Project Implementation Manual 2010, Page VI page 3 14 Millennium Development Goals report for 17 UHSSP Project Appraisal Document, Page 51 Uganda 2013, page 24 18 New Vision, Wednesday, May 27, 2015, page 10 19 Annual Health Sector monitoring report, 2013/14,

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 3 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Section IIB (4b) of the project financing agreement Hospitals, 17 General Hospitals requires the Auditor General to conduct two Value and 27 Health Centre IVs. Under for Money audits over the project duration. The the Infrastructure Division, the first Value for Money audit on The Acquisition and sub-component is coordinated by Utilisation of Medical Equipment under UHSSP the Component Coordinator for was conducted in the year 2014/2015. Improved Infrastructure of Existing It is against this background that an independent Health Facilities with the help of review of the implementation of the UHSSP the implementing districts/health sub-component of renovation/construction of facilities, Project Architect, Quantity construction works of selected health facilities was Surveyor and respective Clerks undertaken by the Office of the Auditor General of Works and in consultation with to assess the progress in implementation of this implementing districts and health sub-component. facilities.

Although the project objective was to 1.3 DESCRIPTION OF THE carry out renovation and construction AUDIT AREA works in 46 health facilities, the scope 1.3.1 General Description of the audit was limited to the 9 Health The Uganda Health Systems Strengthening Project Facilities whose implementation had (UHSSP) is a project under the Ministry of Health commenced before 30th June 2015. (MoH), with funding of USD 144.31 million from both the World Bank (USD 130 million) and Government 1.3.2 Legal Framework of Uganda (USD 14.31 million). The project was The project derives its mandate from established in 2010 and became effective on 10th the financing agreement signed February 2011 and was expected to end on 31st between the Government of Uganda July 2015 but due to delays in implementation, a and International Development 2 year extension period was granted. The Audit Association (IDA)21. primarily focused on the sub-component of renovation of health facilities that was allocated 1.3.3 Vision and Mission 52.6% (USD 75.91million) of the project funds to UHSSP does not have its own vision carry out renovation and construction works in and mission but subscribes to that selected 46 Health Facilities. The health facilities of MoH, which is the implementing for renovation were selected based on remoteness agency of the project and is stated of location; the state of dilapidation; proximity to below: major highways prone to road traffic accidents; MoH Vision22 catchment population; and the need to promote “A healthy and productive population an effective referral system20. that contributes to socio-economic growth and national development” The sub-component for renovation of Health MoH Mission Facilities is administered through the Infrastructure “To provide the highest possible level Division of Ministry of Health. The Division, in of health services to all people in collaboration with procured consultancy firms Uganda through delivery of promotive, was to:- undertake feasibility studies, develop preventive, curative, palliative and detailed designs and tender documents; procure rehabilitative health services at all and supervise contractors for renovation and levels” construction works at 2 Regional Referral 21 UHSSP Financing Agreement: CREDIT No. 4742-UG August 12th 2010, Page No.2 Pages 26 & 28 22 Health sector strategic plan III, 2011, page 20 UHSSP Project Appraisal Document, Page 9 38.

4 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 1.3.4 Project objective Under the UHSSP Component II Improved infrastructure, the objective was to improve the physical infrastructure of existing health facilities in terms of their functionality23 and usage by providing minimum standards of quality health care services24.

1.3.5 Project activities The activities carried out by MoH under the UHSSP component of improved infrastructure, sub-component of renovation and construction include:25 • Carrying out feasibility studies and developing detailed designs and tender documents for renovation/ construction/ re-planning of health facilities at 2 RRHs, 17 GHs and 27 HCIVs. • Carrying out Environmental and Social Impact Assessment (ESIA) and preparing an appropriate Environmental Management Plan. • Renovation and undertaking civil works in 17 General Hospitals, 27 Health Centre IVs, and upgrading, through re-planning, of 2 General Hospitals into Regional Referral Hospitals. • Construction of incinerators, provision of HIV/AIDS clinics and obstetric theatres. • Construction, renovation or completion of staff houses. • Connecting, on a needs assessment basis, the renovated health facilities to reliable sources of water, power, sewage, transport and ICT services • Supervision of the re-planning, renovation and the undertaking of civil works in the targeted health facilities.

1.3.6 Organization Structure The Permanent Secretary of the Ministry is the Accounting Officer for the project. The project is headed by a Project Coordinator (PC) who reports to the Permanent Secretary and is assisted by the Deputy Project Coordinator (DPC). Below the DPC are Component Coordinators (CC) and Focal persons (FPs) of the relevant components and sub-components26. Details of the organization structure are in the organogram attached as Appendix I

1.3.7 Project Funding The project is financed through a loan from IDA of USD 130 million and counterpart funding from GoU of USD 14.31 million27. The component of Improved Infrastructure of existing Health Facilities takes up USD 85.59 million28 translating to 59.27% of the total project budget. The sub-component of renovation of health facilities takes up USD 75.91 million translating to 88.7% of the component budget29. According to the contracts signed, a sum of USD 52.61 million was allocated to nine health facilities under review as shown in Table 1 below:

23 HSSP-Project Appraisal Document: Report No. 53151-UG, April 27th 2010, Page 7 24 UHSSP Project Appraisal Document Page 40 25 UHSSP-Project Operations Manual, September 2010, Page 86&87 26 UHSSP-Project Appraisal Document, Pages 15 & 16 27 UHSSP- Project Appraisal Document, Page 49 28 UHSSP- Project Appraisal Document, Page 50 29 UHSSP Project Appraisal Document, Page 51

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 5 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Table 1 : Contract amounts for the 9 health facilities under review

Health facility Contractor Contract sum (USD) China National Aero-Technology Iganga GH 4,933,885 Engineering Corporation (CATIC)

Moroto RRH Excel Construction Ltd. 8,842,878

China National Aero-Technology Entebbe GH 7,034,065 Engineering Corporation (CATIC)

Anaka GH Excel Construction Ltd. 6,545,233

Moyo GH Prism Construction Company Ltd. 4,541,931

Nakaseke GH Yanjian Uganda Company Ltd 5,090,612

China National Complete Plant Kiryandongo GH 5,654,230 (COMPLANT)

Nebbi GH China Railway No.5 Engineering Group Ltd 3,876,045

Mityana GH SinoHydro Corporation Ltd 6,090,930

Total 52,609,809

Source: Auditors’ summary of contract sums as per signed contracts.

1.4 AUDIT OBJECTIVE The overall audit objective was to assess the extent to which implementation of the Uganda Health Systems Strengthening Project (UHSSP) infrastructure sub-component for renovation and construction of heath facilities was done with due regard to economy, efficiency and effectiveness. The specific audit objectives were: i. To assess the extent to which planning for renovation and construction of Health facilities under the UHSSP infrastructure component was carried out as per the timelines in approved work plans with due regard to the component objective. ii. To assess the extent to which procurement of consultant services and contractors for implementation of civil works was carried with due regard to competitiveness and economy. iii. To assess whether the contracts for the construction of the UHSSP health facilities were executed as per the agreed designs and specification of works. iv. To assess the extent to which supervision and monitoring was carried out to facilitate effective implementation of the renovation and construction projects. v. To assess the extent to which the health facilities are prepared in terms of managing and maintaining the completed facilities.

1.5 AUDIT SCOPE The Audit focused on the sub-component of renovation of selected health facilities specifically the 9 health facilities. The audit covered the project period from 2010/11 to 30th November 2015 and limited itself to the MoH headquarters, MoH infrastructure division in industrial area, the design, and supervising consultants, contractors and stakeholders at the nine implementing health facilities.

6 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 2 CHAPTER TWO CHAPTER TWO

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 7 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL CHAPTER TWO

AUDIT METHODOLOGY

The audit was conducted in accordance with the International Organization of Supreme Audit Institutions (INTOSAI) Performance Auditing Standards and the Performance Auditing guidelines prescribed in the Office of the Auditor General (OAG) VFM audit manual. The standards require that the audit be planned in a manner which ensures that an audit of high quality is carried out in an economic, efficient and effective way and in a timely manner.

Section 40 of the National Audit Act, 2008 empowers the Auditor General (AG) to engage the services of or work in consultation with professional or technical experts or consultants whether in the public service or not, to enhance the performance of the Office of the Auditor General. Accordingly, the OAG engaged engineering and quantity surveying consultants to carry out a technical/engineering audit of the UHSSP infrastructure component project. The consultants worked with the OAG team in undertaking this audit.

2.1 SAMPLING All the eight general hospitals of Nebbi, Anaka, Kiryandongo, Moyo, Mityana, Entebbe, Iganga and Nakaseke and the one regional referral hospital of Moroto in which renovation/ construction works were taking place were selected for the study.

2.2 DATA COLLECTION Audit reviewed documents (Appendix ii), carried out interviews (Appendix iii) and physical inspections to address the audit objectives, the various methods of data collection and analysis used to address each audit question are detailed below;

AQ1.To assess the extent to which planning for renovation and construction of Health facilities under the UHSSP infrastructure component was carried out as per the timelines in approved work plans with due regard to the component objective. The audit team carried out interviews with project management, staff of MOH Infrastructure division, stakeholders at the nine health facilities and representatives of the design consultants to gain an understanding of how planning for the health facilities was conducted and also corroborate information gathered from documents reviewed and other interviews relating to planning for construction and renovation works of health facilities.

The audit team reviewed where available the project appraisal documents, implementation plan, feasibility study reports, design and supervision contracts, detailed design reports, needs assessment reports and annual work plans and budgets. The purpose of the review was to establish the existence of set guidelines for planning and compliance with the guidelines.

8 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL AQ2.To assess the extent to which procurement of consultant services Additionally field inspections were carried out and contractors for implementation through which observations, quantity measurements of civil works was carried with due and structural integrity tests were carried out on regard to competitiveness and the executed works to ascertain conformance to economy contract specifications and designs. Interviews were carried out with the procurement specialist for the UHSSP Measurements and structural integrity tests were project to determine the process carried out by the engineering consultants in the undertaken during procurement presence of representatives from the MoH (Clerks of Work), supervising consultants’ representatives Procurement files for the UHSSP and contractors’ representatives. project were reviewed in order to establish whether the procurement AQ4. To assess the extent to which supervision process adhered to the set guidelines and monitoring was carried out to facilitate and was carried out in a timely and effective implementation of the renovation and efficient manner. construction projects

AQ3. To assess whether the contracts The audit team interviewed the management of the for the construction of the UHSSP nine implementing health facilities, supervising health facilities were executed as per consultants, the project component coordination the agreed designs and specification team tasked with supervision of renovation and of works construction works for the nine (9) health facilities to ascertain whether the supervising team ensured The audit team carried out interviews that works were properly implemented with a high with project management, staff of MOH standard of workmanship, within the scheduled Infrastructure Division, contractors, time and budget. representatives of the design and supervising consultants, stakeholders The Audit team also reviewed, where available, at the nine health facilities to gain an progress reports, contract management files, understanding of how works were monthly site meeting minutes, site diaries and implemented in relation to designs and instruction books to ascertain whether works were specifications as per the contracts for adequately supervised and monitored. renovation of the health facilities and also to corroborate with information AQ5. To assess the extent to which the health gathered from documents reviewed facilities are prepared in terms of managing and maintaining the completed facilities. The Audit team also reviewed available progress reports, contract Interviews were held with MoH officials and management files, monthly site hospital management of the nine implementing meeting minutes, contractor and health facilities to establish their capacity to consultant contracts, drawings to utilize, operate and maintain the renovated and ascertain whether works were carried constructed health facilities. out in accordance with specifications and other contractual requirements. A review of the health facilities budgets and Interim payment certificates were releases for the financial years 2014/15 and reviewed to ascertain whether the 2015/16, and financial statements was done to quantities of works paid for were establish the level of preparedness to operate actually executed. and maintain the health facilities.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 9 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 3 CHAPTER THREE CHAPTER THREE

10 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL CHAPTER THREE

SYSTEMS AND PROCESS DESCRIPTION

3.1 ROLES AND RESPONSIBILITIES OF KEY PLAYERS

3.1.1 Donor (IDA/World Bank) IDA/World Bank is responsible for maintaining the credit and grant accounts and timely release of funds upon granting of a “no objection” after review and approval of documentation and accountabilities are submitted. They also supervise the implementation of the Project and participate in mid-term reviews.

3.1.2 Ministry of Health (MoH) MoH has the overall responsibility for planning, implementation, supervision, monitoring and evaluation of all infrastructure works under the project. The Ministry fulfills this responsibility through the Health Infrastructure Division that is responsible for development and management of health sector infrastructure. The MoH has designated the Permanent Secretary (PS) as the overall Accounting Officer for the project financing, expenditure and attendant accountabilities. The Accounting Officer has the overall responsibility for managing and accounting for the funds and is the principal signatory to the designated and project accounts. The Accounting Officer is assisted by the Under Secretary MoH and Project Coordinator (PC)30.

3.1.3 Project Coordinator UHSSP The Project Coordinator (PC) is in charge of the day to day management of project activities and reports to the PS MoH; The PC is supported by the Deputy PC. The Project Coordinator is responsible for:31 • Planning and holding regular project management meetings with Component Coordinator (CC) and project staff to review implementation progress, Annual Work Plans (AWPs), and budgets. • Reviewing Annual Work Plans from Component Coordinator and ensuring that they are consistent with the Project Appraisal Document (PAD) and Financing Agreement (FA). • Successful implementation of the project and achievement of the Key Performance Indicators (KPIs) and Project Development Objective (PDO). • Working closely with Component Coordinators to ensure timely implementation of component activities. • Briefing the PS MoH on project implementation and drawing his/her attention to policy issues which might require attention at higher levels of leadership and providing , on a regular basis, the requisite periodic reports to the Technical Managment Committee.

30 Project Implementation Manual page 10 31 Project Implementation Manual page 11

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 11 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 3.1.4 Health Infrastructure Division MoH (EIA), preparation of designs, Bills of The Division is responsible for ensuring a network Quantities, technical specifications, of functional, efficient and sustainable health drawings and engineer’s confidential infrastructure for effective health services estimates. The consultants also delivery. The Division is headed by an Assistant assist MoH in preparation of tender Commissioner, who doubles as a Component documents for the works contracts, Coordinator for Improved Infrastructure of Existing responses to the bidders in respect Health Facilities component. The CC takes a lead to clarifications on the bidding in preparation and planning for infrastructure documents and selection of the works works, initiation of project activities, overseeing contractors (bid evaluation process). and supervision of renovation, construction and During the implementation of the expansion works under the Health Infrastructure works, the consultants administer Component. The CC in executing this task is and manage the contracts on behalf assisted by the Focal Person for the component. of MoH in accordance with the contractual terms and conditions. 3.1.5 MOH Project Focal person They also receive and review the The focal person for the sub-component of contractors’ claims before submission renovation of selected health facilities supervises, to MoH for payments. monitors and evaluates the performance of consultants (namely the Project Architect, Quantity 3.1.7 Civil Works Contractors Surveyor) and Clerks of Works at respective health These are selected on the basis of the facilities, and ensures that actual works executed evaluation criteria as stipulated in the are in conformity to the contracts undertaken32. bid documents. They are responsible Project Architect for execution of all the civil, mechanical The Project Architect, in consultation with the and electrical works in accordance Health Infrastructure Division, prepares reviews with the drawings and technical of designs for civil works undertaken under the specifications under each individual project. He/She participates in the tendering contract for the health facilities. process, regularly visits project activity sites, They are also responsible for the participates in monthly site meetings, coordinates implementation of the Environmental and monitors all the architectural matters relating Management Plan in consultation with to the project, and also supervises civil works, the supervising consultants. consultants and clerks of works. Quantity Surveyor 3.1.8 Beneficiary Health Facilities/ A Quantity Surveyor is responsible for managing Districts all the costs relating to civil works of the project The beneficiary health facilities from initial calculations to the final figures. He/ reviewed under the project included: She ensures that project costs are minimized Eight (8) General Hospitals and without compromising the set minimum standards One (1) Regional Referral Hospital and quality targets. The Surveyor also provides (RRH). These participate in planning post-occupancy advice and also advises on for infrastructure and supervision maintenance costs of the health facilities renovated of works at their respective health and constructed under the project. facilities. The Hospital Administrators of these health facilities are also 3.1.6 Design and supervising Consultants charged with proper maintenance These were procured: to carry out site surveys, and management of existing health Environmental and Social Impact Assessment infrastructure.

32 Project Implementation Manual page 14

12 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 3.1.9 District Local Governments by the Health Infrastructure Division of the MoH The District Accounting Officers/Town supported by design consultants alongside the Clerks, District /Municipal Physical World Bank team to establish renovation and Planner, the Health Inspector and construction needs including architectural designs Engineer of the districts in which the for health facilities33. respective health facilities are located The Coordinator and Focal Person for the Health are responsible for review, approval Infrastructure component together with the Project and monitoring of all architectural Coordinator use the information obtained to and structural drawings used by develop a project plan. The project plan is detailed the contractor(including all other in the Project Implementation Plan (PIP) from developers) to ensure that they meet which annual work plans are developed. the standard building requirements, The project plan entails the expected outputs, and Public Health Act and Regulations activities to be carried out, time frames, and that they are in line with the responsibility centres/ persons and the required district physical and development inputs. This is then incorporated into the project master plans. annual work plan and submitted to the World At the District level of the beneficiary Bank for approval34. health facilities, the District Health The final approved architectural and structural Officer and the District Engineer drawings by MoH for the health facilities are share the responsibility of ensuring required to be approved by the District/Municipal proper planning, maintenance, Local Government authorities to ensure compliance management and supervision for with the district/municipal area development health infrastructure in the respective master plans and building rules in the Public districts; for RRH this role is played Health Regulations. by the Hospital Director. Site meetings are always attended 3.2.2 Procurement by relevant district officials, such i. Procurement of Design Consultants for Health as, Resident District Commissioner, facilities LCV Chairperson, Secretary for Social The Ministry of Health procures consultants Services and the representatives of civil to carry out preliminary feasibility studies society. The purpose of the meetings (needs assessment) and detailed designs of is to supervise the contractor, assess the Health Facilities and come up with outputs the physical progress, and agree on arising from the studies as design reports, a way forward for works. site survey reports, environmental and social impact assessment reports, topographical 3.2 PROCESS reports, site investigation and geotechnical DESCRIPTION investigation reports, site lay out plans, architectural and structural design drawings, The renovation/construction of tender documents, technical specifications the nine health facilities follows and engineer’s confidential estimates. a sequence of major processes, The MoH Project Architect reviews the design namely: planning, design of health for civil works undertaken by the project for facilities, implementation, monitoring, quality assurance and fulfillment of the users’ supervision and maintenance as needs. described hereunder. Procurement of the design consultant is done under UHSSP in accordance with: 3.2.1 Planning The planning process for civil works 33 UHSSP concept paper, report No: AB4692, April 9, 2009, Page 3 starts with a feasibility study conducted 34 UHSSP-Project Implementation Manual, Pages 13, 14, 29, 30

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 13 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL and IDA Credits” dated May 2004 (i) The World Bank’s Procurement revised October 2006” . “Guidelines namely: After preparation of the user (a) Procurement under IBRD Loans and requirements, advertisements IDA Credits” dated May 2004 and revised are placed in media of nationwide in October 2006; coverage. On receipt of bids, (b) Selection and Employment of evaluation is undertaken, in which Consultants by World Bank Borrowers a quality cost based selection dated May 2004 and revised in October criteria is set as the basis for 2006. selection of the best contractors (ii) The provisions stipulated in the UHSSP per lot. Financing Agreement. (iii) The Public Procurement and Disposal iii. Procurement of the Supervising of Public Assets (PPDA) Act (2003) and Consultant PPDA Regulations (2003)35. Appendix The Ministry procures supervising IV shows the PPDA procurement flow consultants to act as the Project process. Manager as defined in the World Bank’s standard Contract for Needs Assessments of the existing Health works to supervise the Contractor facilities in all aspects of construction The procured consultants carry out detailed activities on the site, including needs assessments and feasibility studies on management, co-ordination and the selected health facilities to evaluate the control of the construction works. structural integrity and functionality of the Procurement of the supervising existing structures of the Health facilities. consultant is done under UHSSP in accordance with the After the review of the feasibility study reports World Bank’s procurement by MoH and the consultant, the consultant “Guidelines: Procurement under proceeds to prepare preliminary designs IBRD Loans and IDA Credits” complete with drawings (architectural, dated May 2004 revised October structural, mechanical and electrical) for the 2006; “Guidelines: Selection and structures to be renovated and constructed Employment of Consultants by and produce a design report for the health World Bank Borrowers” dated facilities, which are then submitted to the MoH May 2004, revised October 2006, and the World Bank for approval. the provisions stipulated in the UHSSP Financing Agreement, the ii. Procurement of the works contractors Public Procurement and Disposal After the approval of the feasibility study reports of Public Assets (PPDA) Act (2003) and design reports prepared by the design and PPDA Regulations (2003). consultants, the procurement of contractors Appendix IV shows the PPDA to carry out civil works for renovation and procurement flow process. construction of the targeted health facilities in line with the requirements of the terms and 3.2.2 Implementation conditions of the contracts is initiated. The MoH through its Infrastructure The contractors are procured following PPDA, Division takes the overall responsibility and World Bank procurement rules and for implementing and coordinating guidelines “Procurement under IBRD Loans construction and renovation activities

35 UHSSP-Project Implementation Manual 2010, Page 39

14 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL under the project36. used for renovation and construction works in i. Works Contractors accordance with the technical specifications for The procured contractors carry out the contract, carry out field inspections in order civil and electro-mechanical works to ensure that works are executed in accordance for renovation and construction with standard drawings and specifications in of the targeted health facilities the contract, convene monthly site meetings in line with the requirements of and monitor implementation of actions and the terms and conditions of the recommendations on works arising out of the contracts. site meetings. In accordance with the special They review and recommend to MoH all changes conditions of contract, these in the architectural and structural drawings that contractors are required to may have arisen during implementation for quality develop and submit a detailed and cost control in order to keep the variations work program and any subsquent within budget. revisions for renovation and They also review the contractor’s quality assurance construction of works covering program to ensure that renovation and construction the whole contract duration to works implemented achieve the desired level of the supervising consultant for quality and workmanship. approval. In addition the contractor In addition, they maintain records and reports is required to commit all the relating to execution of works for the purpose of plant, equipment, machinery monitoring progress and keeping MoH informed. and key personal on the works in accordance with the construction b) Ministry of Health Focal person contracts until their release has The MoH focal person is responsible for the been authorized by the supervising project sub-component of renovation and consultant. construction of health facilities and is assisted The contractor should prepare by Project Architect, Quantity Surveyor and the and implement a quality Clerk of Works at each health facility. assurance program involving i. Project Architect testing of materials to be used in The Project Architect frequently visits project construction. activity sites, participates in monthly site meetings, coordinates and monitors all the ii. Monitoring and supervision of architectural matters relating to the project, works and also supervises the works, consultants a) Supervising consultant and clerks of works.37 The supervising consultants are ii. Quantity Surveyor required to ensure that all works The Quantity Surveyor is responsible for executed and materials supplied in supervision and monitoring of project works the contracts for the selected health by ensuring that all costs relating to civil facilities meet the specified standards works of the project are managed from initial of quality and that the contractor’s calculations to the final figures. Additionally detailed programme for renovation approving the time sheets for the Supervising and construction of works adheres to consultant’s staffs and ensuring that project the planned schedules for completion costs are minimized without compromising the and commissioning of the Project. set minimum standards and quality of works The supervising consultants are implemented by contractors.38 required to approve all materials At the pre-implementation stage he reviews

36 UHSSP-Project Implementation Manual 37 UHSSP-Project Implementation Manual 2010, Page 22 2010, Page 7 38 UHSSP-Project Implementation Manual 2010, Page 22

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 15 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL the BoQs sent out in the tender documents reviews the challenges at hand and to establish accuracy and completeness of a way forward is agreed on with all the quantities of work items to be used in stakeholders at hand. A Clerk of Works the renovation and construction contract. At prepares daily activity reports while implementation the QS reviews the IPCs to the contractor and the supervising ensure conformity of the valuation of works consultant prepare monthly, quarterly with that originally specified in the contract. and annual progress reports. The The Quantity Surveyor also provides post- Project Architect then reconciles the occupancy advice and also advises on information into quarterly and annual maintenance costs of the health facilities progress reports that are submitted re-planned and renovated under the project. to the project management team and iii. MoH Clerks of Works the World Bank for review. The MoH Clerks of Works monitor the daily progress of works, participate in joint 3.2.4 Maintenance measurement during valuation of works for On completion, sections of the the purpose of preparation of IPCs, monthly facility are handed over to the site meetings, joint site inspection, preparation respective hospital administration, and submission of monthly progress reports for and the sectional completion works executed in order to ensure compliance certificates issued and this marks with the terms and conditions of the contract. the commencement of the defects iv. Monitoring and Evaluation Specialist liability period for that particular The Monitoring and Evaluation Specialist section. ‘As built’ drawings covering processes and keeps track of project activities both architectural, mechanical through undertaking regular field trips to and electrical components for the project sites to monitor and evaluate the outputs completed sections are also issued. outcomes and impact indicators in accordance The hospital management utilizes the with the project guidelines39 by production of facility and notifies the contractor/ monthly M&E reports. consultant of any defects, which c) Hospital Management defects are corrected within the These are responsible for supporting the works defects liability period. The hospital contractors and the supervising consultants management is obliged to maintain by chairing the monthly progress meetings, the facilities that have been handed ensuring that the users’ needs are fulfilled over to them. by the construction works and that the works In accordance with the Public Health support the functionality of the health facilities. Act, an occupation permit has to be sought from and issued by the local 3.2.3 Reporting authority before utilization of the The day-to-day collection and management of buildings. information is through the already existing Health Management Information Systems. The supervising consultant convenes all the stakeholders including health facility management, respective district management, the contractor, and MoH representatives for monthly site meetings on every first Friday of the month. During the meeting, the consultant reports on the progress of works,

39 UHSSP-Project Implementation Manual 2010, Page 19

16 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL 4 CHAPTER FOUR CHAPTER FOUR

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 17 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL CHAPTER FOUR

FINDINGS, CONCLUSIONS AND RECOMMENDATIONS

The MoH has achieved significant progress in the implementation of the UHSSP project. The project is in its 5th year of implementation. Six (6) out of the nine (9) health facilities under renovation and construction have been completed and handed over to their respective hospital management boards. By the time of audit (November 2015),the physical progress achieved in respect to the nine (9) health facilities was; Nakaseke Hospital (100%), Anaka Hospital (100%), Mityana Hospital (100%), Moroto Hospital (100%), Kiryandongo Hospital (93%), Iganga Hospital (100%), Entebbe Hospital (100%),Nebbi Hospital (70%),and Moyo Hospital (78%). A summary of contract details and observations for each of the Health Facilities is attached in Appendix V However, this study has identified some areas that require improvement in order to steer the project towards achievement of its objectives and also inform better planning and contract management for future projects of this nature.

4.1 PLANNING The Project concept paper states that planning for works was to include a feasibility study to establish the renovation and construction needs of selected health facilities and develop detailed designs, working drawings, Bills of Quantities (BoQs) and tender documents with confidential cost estimates for proposed interventions40. The 5-year work plan for UHSSP (2010-2015) as approved by MoH and the World Bank states the start and completion dates of all the project activities. Accordingly, activity 2.1 of the approved plan states that consultancy services were to come up with the detailed designs and tender documents in a period of six (6) months, from January to June 2011, as stated in section 2.3 of the special conditions of contracts signed. Through review of consultancy contracts, design reports and the works contracts for renovation and construction of the selected health facilities, it was noted that consultancy service contracts for the development of detailed designs and tender documents were signed on 6th January 2011 and thus detailed designs and tender documents were expected by 6th July, 2011. However, design reports were submitted to MoH in July 2012, resulting in a delay of twelve (12) months at design stage. In addition to delays, there were gaps in planning for renovation and construction works notable in the areas of needs assessment, designs and cost estimation.

Management Response The six months that had been planned for completion of the designs was inadequate. The consultants implemented the design assignment in four stages with outputs namely: Inception

40 UHSSP concept paper, report No: AB4692, April 9, 2009, Page 3

18 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL report, site survey, scheme design, facilities had they been offered an opportunity draft final and final report. At each to choose. of these stages, there were extensive Inadequate needs assessments at the health consultations with the stakeholders facilities were attributed to the fact that the contract and the World Bank. This led to the manager for consultancy services for design of increased time for submission of the renovation and construction of health facilities final reports. never ensured that all user needs were ascertained, prioritized and incorporated in the architectural Recommendation and engineering design process; this subsequently In future, planning for such projects resulted in various design changes and variation should be more robust to avoid orders during the construction of the works. implementation delays. Management Response 4.1.1 Needs Assessment Needs assessment was done in accordance The contracts for development of with the project objectives aimed at addressing; detailed designs and tender documents accidents and emergencies, reproductive health for construction of the health facilities (maternal health and new born care), staff retention required the consultants to undertake and motivation and chronic care illnesses. This a comprehensive study of the existing therefore formed the basis for the determination health facilities to determine their of renovations and new construction works. adequacy for services offered, It is worth noting that due to the high staff turnover and propose new developments in at the health facilities, most of the staff consulted accordance with the scope of services in 2011 had moved to other health facilities at the offered. The consultants were to carry time of the audit. Thus, during implementation, out a needs assessment at the allotted it was realized by the present stakeholders that project sites to determine the existing some facilities needed to be included into the situation, survey the site and available works for proper functionality of the hospitals, land, assess existing equipment, and these were inevitably included as variations. health facility buildings, available space and staff housing for eligible Audit Comment core staff; analyze the findings and The needs assessment undertaken was inadequate propose appropriate interventions. since the reports provided did not show who was consulted, when they were consulted and what their The audit revealed that while the inputs were to address the needs of the hospital consultants carried out needs facilities as noted in the numerous variations made assessments at some facilities, this during the construction process. For example, the was found to be inadequate; the level most urgent need in Moroto Regional Referral of consultations amongst staff in the Hospital was an in-patient department yet the user departments of the selected hospital received an Out Patients Department health facilities was only focused on (OPD) instead. In addition, most of the facilities renovation of existing health facilities considered staff housing as an urgent need. and did not focus on planning for construction of new health facilities. Due to inadequate needs assessment, variation Interviews with users in the health orders shown in Table 2 were incurred. facilities of Kiryandongo, Nakaseke, Moyo, Anaka and Nebbi indicated that they would have prioritized construction of additional staff houses rather than the newly constructed

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 19 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Table 2: Variation orders per health facility Health facility Variation Orders (USD) Mityana 104,445.58 Moroto 41,141.24 Iganga 30,471.72 Entebbe 199,377.96 Anaka 53,220.35 Kiryandongo 190,496.39 Nebbi 219,843.44 Moyo 34,103.02 Nakaseke 361,750.45

TOTAL 1,234,850.15 Source: OAG analysis of payment certificates

Recommendation The Ministry should: • Ensure that a review of user needs assessments is undertaken at completed facilities to establish the critical needs to be addressed in order to ensure optimum utilization of the handed over facilities. • In view of the fact that additional health facilities are still under renovation and construction; ensure that needs assessments for users are undertaken, prioritized and incorporated in the architectural and engineering designs process in order to reduce unnecessary variations in costs of renovation and construction.

4.1.2 Designs and Cost Estimation In line with the scope of services as stated in the Terms of Reference in the contract for development of detailed designs and tender documents for construction of health facilities the consultants were to analyze the results of the comprehensive study undertaken and: • Propose appropriate interventions in accordance with the scope of services offered at the facility. • Review and update the designs of all the existing facilities under this contract, incorporating any changes in accordance with the service requirements. • Carry out detailed geotechnical investigations, topographical surveys and site surveys prior to the development of the proposed designs. • Develop detailed designs, working drawings, specifications, bills of quantities, confidential cost estimates and tender documents for the proposed interventions arising out of the feasibility studies.

According to the Special Conditions of Contract Section 6.4 “twenty percent of the contract sum shall be paid upon submission of an acceptable site survey report”, including topographical and geotechnical investigations. A review of the available design reports and related documentation revealed that the topographical reports submitted by all the design consultants for the health facilities under review were inadequate. The implication is that lack of adequate topographical surveys led to variations as shown in Table 3.

20 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Table 3: Variations due to inadequate topographical surveys per hospital

S/No Health facility Summary of variations

1 Nakaseke • Diversion of existing services

2 Kiryandongo • Service lines to the staff houses

• Cutting existing trees 3 Anaka • Removal of existing steel tank and structure • Removal of existing fence posts and chain link fence

4 Moyo • Power diversion

5 Moroto • Cutting of existing trees

6 Iganga • Cutting of existing trees • Cutting of existing trees 7 Entebbe • Storm water diversion Source: OAG analysis of payment certificates

A review of geotechnical reports revealed that the geotechnical investigations carried out were inadequate as the reports for Nebbi, Kiryandongo and Anaka Health Facilities were based on only three (3) trial pits and only two (2) trial pits for Entebbe. For Nebbi Health Facility, although the site sketch map showed the trial pit locations, none of the three trial pits was excavated in the area of the new OPD or casualty block. Trial Pit (1) which is claimed, according to the sketch map, to have been excavated in the proposed area for T-block extension reported no rock at a depth of 4.1m yet the contractor reported having encountered a rock at a depth of 1m. Whereas in the BoQ for Nebbi GH rock quantities were estimated at 670m³ for the T-block extension, the Contractor reported mass excavation of 5,670m3of rock in the progress reports which amount tallied with the quantities shown in the Interim Payment Certificates (IPCs) translating into additional payment of USD 173,650.

The audit also revealed inadequacies in the final designs issued at tendering stage. The implication is that BoQs issued to bidders were generated from the final designs that were inadequate. This has led to increased quantities in the BoQs during construction.

At pre-implementation stage, MoH did not adequately review the designs and tender documentation prepared and submitted by the design consultant to establish accuracy and completeness. As a result of inadequacies in needs assessments and site investigations which translated into inadequacies in designs and BoQs, a sum of USD 1,234,850.15 was incurred as variations during project implementation as at 30th October 2015 as shown in Table 4 below.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 21 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Table 4: Variations

Variations S/No Health facility Summary of Design Changes Orders (USD)

• Diversion of existing services • Construction of incinerator house, powerhouse, generator and transformer pads, security house • Fencing hospital 1 Nakaseke 361,750.45 • Fencing the solar pumps and lagoons. • Window adjustments • Tents • Closing eaves

• Construction of incinerator house • Fencing incinerator and pits • Extra costs incurred for replacing Wastewater treatment plant with refurbishing existing lagoon 2 Kiryandongo 190,496.39 • Cable trays • Closing of eaves • Service lines to the staff houses • GI pipes for main storage tank • Stone pitched retaining wall

• Temporary mortuary, placenta pit, soak pit and four stance pit latrine. • Filling of pits 3 Mityana 104,445.58 • French drains and open drains at OPD and T-Block • OPD and T-Block modifications • Expansion joints

• Cutting existing trees • Removal of existing steel tank and structure • Removal of existing fence posts and chain link fence 4 Anaka 53,220.35 • Emptying pit latrines • Fencing the lagoon • Stone pitched retaining wall

• Rock excavation at T-Block • French drain at T-Block 5. Nebbi 219,843.44 • Retaining wall at causality ward • Incinerator house

• Power diversion 6 Moyo 34,103.02 • Ramp at laundry and kitchen • Stone pitching

• Cutting of existing trees 7 Moroto 41,141.24 • Construction of the incinerator house and generator house • Steel posts at the staff houses

• Cutting of existing trees 8. Iganga 30,471.72 • Relocation of incinerator • Construction of the incinerator house and battery cage

• Installation for x-ray system • Storm water diversion 9. Entebbe 199,377.96 • Construction of the public toilets • Generator bases • Electrical and mechanical variations.

TOTAL 1,234,850.15

Source: OAG Analysis of IPCs as at 30th October 2015

22 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Management Response 4.1.3 Cost Estimations for Renovation and The contracts signed are Construction Works admeasurement contracts. The BoQs Article IV, section 4.07 (a) of General conditions in the contract give a rough estimate for IDA/ World Bank loans for approval required of what is expected in the works. The the borrower to specify the plans, schedules and increased quantities in the BoQs were specifications of the amounts they intend to borrow. as a result of actual measurements on The Project concept paper further required the site after execution. There were also project to conduct a feasibility study to generate cases where the quantities decreased. cost estimates to aid planning.

The variations of USD 1,234,850.15 A review of the financing details in the Project were not entirely due to inadequacies Appraisal Document and Project financing in the needs assessment. Some items agreement indicates that the Project had estimated like cutting existing trees were the to use USD 75.91 million to carryout renovation realisation of the danger they posed of 17 General Hospitals (GHs) and 27 Health to vehicles in the parking yard, or Centers type IV (HCIVs) and upgrade two (2) General relocation of some buildings due to Hospitals into Regional Referral Hospitals (RRHs) inadequate land and/or encroachment. at the time of loan application and approval. Some of the items like relocation of incinerator were entirely new in scope However, following a feasibility study done by and were not part of the original scope the design consultants, the figure rose to USD of the works but were found necessary 419.38 million for the same number (46) of health by the stakeholder meetings. facilities. The nine facilities under the project were estimated to cost USD 149.68 million based on the Audit Comment feasibility study done by the design consultants. We note that the issues raised in the management response were pre- The underestimation of costs for infrastructure existing conditions that should have works was due to the failure by the Ministry of been noted during the design stage. Health to conduct a comprehensive assessment of existing infrastructure at the targeted health Recommendation facilities in order to come up with adequate The Ministry should: proposals and cost estimates prior to project • Assess the impact of not carrying appraisal and approval. out adequate site investigations by the consultants and give assurance The Audit established that in the design reports on the functionality of the affected presented, the consultant states having used health facilities; and recommended design codes (British Standards), • For the continued renovation however, no design sheets/calculations were and construction of the other presented to enable assessment of compliance health facilities adequate to logical engineering design procedures used for site investigations should be the proposed health facilities. In the absence of undertaken to ensure that the the design sheets/calculations, the audit could not designs developed are adequate ascertain whether the designs were economical. for execution of works. The underestimation of costs for renovation works at project appraisal has led to a reduction in the scope of works as the project could not undertake the anticipated works in all the target sites of forty-six (46) health facilities.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 23 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Management Response of detailed designs and tender The estimate of USD 75.91 million was a result of documents were signed on 6th a desk study because the Ministry at the time did January 2011 and were to use six (6) not have resources to undertake a comprehensive months for design and preparation of field study. The Ministry however, is in discussion tender documents and six months for with Ministry of Finance, Planning and Economic procurement of the works contractors. Development to provide funds for studies for However, tender documents were hospital renovation before presentation to financing submitted to MoH in July 2012, agencies. resulting into a delay of twelve (12) months at design stage. Recommendation The Ministry should: Management Response • In future, carry out proper planning to ensure The consultants participated in that cost estimation for works at project the procurement of contractors appraisal is adequate and does not result in through management of the pre- significant cost variations and scope reduction. bid meetings and arithmetic checks • Ensure that the design reports produced ,have of contractors bids. They could not design sheets and calculations to assess sign the evaluation reports because whether they are economical. they had not been nominated by the Contracts Committee. 4.2. PROCUREMENT In line with renovation and construction works, Audit Comment the UHSSP carried out procurement of design and The Contracts Committee ought to supervision consultants, and works contractors have nominated the consultants since for selected health facilities. the contract for design and tender documents required the consultants to 4.2.1 Procurement of Design Consultants be engaged in the evaluation process. The design consultants were to assist the project team in procurement of contractors for renovation Recommendation and construction of the Health Facilities. Part A6 The Ministry should ensure that the of the detailed scope of services of the contract contractual obligation in the contracts for development of detailed designs and tender for design and preparation of tender documents states that the consultant shall documents are adhered to. For support MoH in procurement of contractors, the remaining health facilities, the including preparation of responses to queries consultants should be visibly engaged and corrections to the bidding documents; and in the bid evaluation process. evaluation of contractors’ bids in accordance with the PPDA Act and the World Bank procurement 4.2.2 Procurement of Works guidelines. For this particular term of reference, Contractors the three design consultants were entitled to 10% It was further noted that the of the contract sum, amounting to USD 73,454.8 procurement process for works and UGX 141,842,500 upon approval of the bid contracts commenced in July 2012, evaluation report. twelve (12) months beyond the planned Whereas the consultants participated in the pre- commencement and was completed th bid meeting, the audit could not confirm that the at contract signing on 29 October consultants participated in the bid evaluation 2013, resulting in a delay of twenty process. two(22) months beyond the planned The Consultancy Service contracts for development completion period of December 2011. Delays in the procurement of works

24 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL contractors was caused by delays in commencing the procurement process on time due to changes in scope of works to fit into the available funding of USD 75.91 million41. The failure by the project to procure contractors on time (December 2011) delayed the commencement of renovation and construction of works at the health facilities; specifically, commencement days were shifted from January 2012 to January 2014. This resulted in non-utilization of donor committed funds that have attracted a non-utilization penalty of USD 256,517.49.

Management Response Penalty fees are a result of the project inability to utilize funds as per the timelines in the disbursement schedules of the loan agreement. Renovation and construction works could not take off as planned as the preceding activities including feasibility study, design preparation and procurement of contractors were only started after the loan was approved and took longer than had been anticipated.

Recommendation The Ministry should ensure that all preliminary activities for future projects are completed prior to signing of financing agreements; and adequate procurement planning is undertaken to ensure that contractors are procured on time.

4.3 IMPLEMENTATION AND PROGRESS OF WORKS According to the UHSSP five year project plan, the contracts for works were to commence in January 2012. The renovation and construction works were to take thirty six (36) months, starting from January 2012 to December 2014. Audit revealed that renovation and construction works that were scheduled to start in January 2012 as per the approved plan were delayed by approximately twenty-four (24) months. The contracts for renovation and construction of the Health Facilities signed between the MoH and the contractors provided for contract periods of 18 months for completion of works. Accordingly, in the nine(9) health facilities under review, the works commenced between 6thJanuary and 28th February 2014. It was established that even after commencement, the works still delayed by more than three (3) months in all the 9 health facilities. At the time of audit (November 2015), works were still on going in six health facilities yet the contracts had elapsed. In the 3 health facilities of Nakaseke, Moroto and Anaka works had been substantially completed and handed over. Details of the progress of works per contract are summarized in Table 5 below.

Table 5. Contract execution period and status of Implementation of works

Planned Intended Actual delay in Heath commencement Contract completion Physical Months As at Contractor date as per Commencement date Facility approved 5 Year date* progress 30 November plan End date 2015

China National Aero- 14th February 13th August Entebbe technology January 2012 90% 3 months 2014 2015 International Engineering Corporation

41 Project Appraisal document page 51

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 25 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Planned Intended Actual delay in Heath commencement Contract completion Physical Months As at Contractor date as per Commencement date Facility approved 5 Year date* progress 30 November plan End date 2015

Sinohydro 24th February 23rd August Mityana Corporation January 2012 90% 3 months 2014 2015 Ltd

Taking over certificates dated 2nd May 2015 for staff houses and 1st Yanjian April 2015 for Uganda 30th July 100% and Nakaseke January 2012 31st January 2014 new OPD and Company 2015 in use new casualty Ltd. block. No taking over certificates for the other facilities

China National Aero- 30th July Iganga technology January 2012 31st January 2014 80% 4 months 2015 International Engineering Corporation

Excel no taking over Construction 29th January 28th July 100% Moroto January 2012 certificates Company 2014 2015 seen Ltd.

China National Complete 2nd February 1st August Kiryandongo January 2012 93% 3 months Plant 2014 2015 (COMPLANT) Ltd

Prism Construction 28th February 27th August Moyo January 2012 78% 3 months Company 2014 2015 Limited

China Railway No.5 24th February 23rd August Nebbi January 2012 70% 3 months Engineering 2014 2015 Group Ltd

26 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Planned Intended Actual delay in Heath commencement Contract completion Physical Months As at Contractor date as per Commencement date Facility approved 5 Year date* progress 30 November plan End date 2015

Taking over certificates dated 8th June 2015 for Construction of casualty block, 16th September 2015 for refurbishment of the existing OPD Block, Excel 18th May Construction 5th July 100% 2015 for Anaka January 2012 6th January 2014 Company 2015 Construction Ltd. of new OPD. However the certificates are endorsed in November 2015 and December 2015 by the various parties except the MoH who have not yet endorsed them

Source: OAG Analysis of Contracts for Works * Contract commencement date is the date of receipt of advance payment by the contractor as stipulated in the contract for works.

From a review of contract management files and interviews with project management and staff at the Health Facilities, it was established that delays in renovation and construction of works at the Health Facilities were attributed to the following: Delay in procurement of design consultants The invitation for expression of interest for the Design Consultants was published in the Daily Monitor on 25th and 29th June 2009. It was re-advertised in the Daily Monitor on Thursday 10th and Friday 11th September 2009. This caused a delay of two and half months in the procurement of the Design Consultant.

Management Response This was due to the changes made to the Expression of Interest in compliance with the World Bank Procurement Regulations.

Inadequate needs assessment in Design Reports The contracts for the development of detailed designs and tender documents for renovation and construction of the Health Facilities required consultants to undertake a needs assessment for all the health facilities to determine their adequacy for services offered and propose new developments in accordance with scope of works offered. Audit established that the needs assessments undertaken by the design consultants were inadequate for all the nine Health Facilities, resulting in shortfalls in the designs. The latter designs were also not fully appraised by the project coordination team to ensure that the

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 27 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL designs met the user needs and other regulatory requirements. As a result, there were several design changes leading to variations at construction stage as shown in Table 4 on variations.

Management Response The design changes, as observed, were not only as a result of inadequate needs assessment or non-appraisal by the Project Coordination team. Most of these came as a result of introduction of new items to the Contracts by the stakeholders for better functionality of the Health Facilities.

Recommendation The Ministry should: • Ensure that adequate procurement planning is undertaken in accordance with PPDA and World Bank guidelines. • Ensure that comprehensive needs assessments are undertaken and incorporated in the detailed designs. • Ensure that adequate measures are put in place in regard to supervision and monitoring of contracts for design, works and construction supervision to ensure timely execution of works. • Ensure that design consultants are procured on time and project managers appointed to oversee development of adequate architectural and structural designs to allow timely commencement of works.

4.3.1 Quality of works - Visual assessments Clause 4.1 of the Works Contract requires the contractor to execute and complete works in accordance with the specifications in the contract (standards of workmanship: materials quality, type and dimensions), and the engineers instructions and remedy any defects in works. On the basis of visual assessment, the quality of works at most Health Facilities was acceptable, however, there were instances of poor workmanship, for example: on some terrazzo floors, plastered walls and benches where cracks were observed, as shown in the picture 1 below.

28 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Picture 1: Showing cases of poor workmanship at Moroto Health Facilit Observations on Moroto health Facility

2 Bed Room staff House

Some cracks were observed on the apron.

Cracks on the apron

Crack on staircase Crack on OPD floor

Source: OAG field inspections/observations

The quality deficiencies were attributed to poor workmanship exhibited by the contractor in finishes and lapses in contract supervision during execution.

Management Response The poor workmanship resulting into cracks were noted and have since been rectified. Further monitoring and observation during the 12 months defects liability period is being undertaken for any defects that may appear.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 29 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Recommendation The Ministry should: • Strengthen the supervision and monitoring capacity for works to ensure adherence to agreed quality standards during contract execution. • Continuously monitor completed works to ensure that all defects arising within the liability period are rectified.

4.3.2 Quality of works on structures - Test results A UPV test is a non-destructive test used to check the quality of concrete and natural rock by measuring the velocity of an ultrasonic pulse passing through a concrete structure or natural rock formation to determine strength of structure. The principle of assessing the quality of concrete is that comparatively higher velocities are obtained when the quality of concrete in terms of density, homogeneity and uniformity is good. High velocity for UPV test indicates good quality and continuity of material used while slow velocity may indicate concrete with many cracks or voids. Table 6 shows the criteria for UPV Tests and its implication on concrete quality.

Table 6: Criteria for UPV tests (BS 1881, 1983) Criteria [speed m/s] Concrete Quality ≥4,500 Excellent 3,500 to 4,500 Good 3,000 to 3,500 Medium Below 3,000 Doubtful

On the other hand the rebound hammer is used to test the strength of concrete used on the structure on the basis of the elastic properties or strength of concrete or rock, mainly surface hardness and penetration resistance.

The team conducted rebound hammer tests and UPV tests (confirmatory test) for all nine (9) health facilities on concrete elements (columns, beams and slabs) of selected structures in each health facility, to confirm if the strength of concrete used for the works meets the strength of the parameters specified in the contract. In addition, the tests confirmed whether or not the concrete density, homogeneity and uniformity was of good quality. The rebound hammer test results for the nine health facilities were within the required range of ≥25Mpa which is within the range of specified concrete strength of class C25 for the various structural components of the buildings as shown in Table 7

Table 7: Showing results of Non-destructive tests using Rebound Hammer

Rebound Actual Rebound Health facility Structures tested Hammer Hammer Test Criteria Results Entebbe Centralised Block 25MPa Pass Moyo T-Block Extension, Casualty Block and New OPD 25MPa Pass Nebbi T-Block Extension and New OPD 25MPa Pass Anaka T-Block Extension, Casualty Block and New OPD 25MPa Pass Kiryandongo T-Block Extension and Casualty Block 25MPa Pass Nakaseke T-Block Extension 25MPa Pass

30 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Mityana T-Block Extension, Staff House, New OPD& Casualty 25MPa Pass Iganga Staff Houses 25MPa Pass Moroto Staff House, New OPD& Casualty 25MPa Pass Source: OAG analysis of rebound hammer test results 2015.

The concrete strength generally met the strength specification requirements of Class C25 of 25MPa. However, there were cases of doubtful quality of concrete on the basis of UPV tests for Nebbi, Anaka, Kiryandongo, Mityana, Entebbe and Moyo health facilities as shown in Table 8. The implication is that for some of the concrete members the density, homogeneity and uniformity of the concrete was poor despite them meeting the overall minimum strength parameter of 25MPa. This can be attributed to poor workmanship during construction, leading to inadequate compaction when placing concrete for some of the structures, hence significant presence of voids at those locations. The voids provide passage ways by which acidic moisture and gases that attack the alkaline concrete can penetrate hence posing future risk to the integrity of the structures. Periodic testing of these concrete members is recommended every five years to monitor future performance.

Table 8: Selected Results of Non-destructive Tests using UPV

Actual Health facility Structures tested UPV Criteria [m/s] Remarks UPV results [m/s]

1920 Concrete Entebbe Centralised Block ≥3000m/s 1620 quality doubtful 2280

T Block Ext Col H1 2343 Concrete Moyo T Block Extension Col ≥3000m/s quality doubtful H ramp 812

T Ext col G7 1,025 T Ext Co J7 1,262 Concrete Nebbi T Ext Col J1 ≥3000m/s 2,665 quality doubtful First floor slab grid (6-7) 1,698 and (I-H)

Casualty Block Ext col 1,457 Concrete Anaka New OPD Ext col 1 ≥3000m/s 1191 quality doubtful New OPD Ext col 2 2,777

Casualty block 844 Concrete Kiryandongo T Block Extension C3 ≥3000m/s 1107 quality doubtful T Block Extension C4 1,312

Concrete Mityana Staff House ≥3000m/s 2,994 quality doubtful

Source OAG Analysis of UPV test results 2015

Results shown in Table 8 above, could have resulted from the supervising consultants not exercising adequate quality control checks to ensure that workmanship for the concrete works executed met the minimum required specifications in the specific health facilities.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 31 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Management Response The doubtful quality of concrete as evidenced by the UPV tests could have been a result of some cases of poor workmanship by contractors who preferred to cast concrete at night in the absence of the supervising consultant. This was, however, noticed early and the contractors were cautioned. It is also worth noting that the low pulse velocities from the UPV test compared with the very good results from the rebound hammer test is not necessarily an indicator of poor quality concrete but more importantly that the concrete is not prone to corrosion. Further, chemical analysis tests for confirmation of carbonation and pH are usually recommended and the contractors are going to be instructed to undertake random tests in this case for confirmation.

Audit Comment Audit takes note of the Ministry’s proposed action of undertaking additional chemical analysis tests to confirm concrete quality.

Recommendation The Ministry should: • Ensure that adequate quality control checks are undertaken during execution of works by the supervising consultant by ensuring a contract manager is appointed to oversee implementation of the contract for supervision of renovation and construction of works. • Undertake chemical analysis tests for confirmation of carbonation and pH to ensure that the concrete is not prone to corrosion.

4.3.3 Contribution Of Counterpart Funding Towards Constructions According to the Project Appraisal Document, Table A5-4 UHSSP Project costs by sub- components, GoU was to contribute USD 12.59 million towards renovation of selected health facilities for identifiable taxes and duties.

A review of bidding documents and contracts for renovation and construction works of the UHSSP revealed that all unit rates in the signed contracts for works were inclusive of taxes, where applicable.

As such, government’s commitment to pay all identifiable taxes and duties relating to renovation and construction works under UHSSP was redundant. In addition, whereas approved estimates for FYs 2010/11, 2011/12, 2012/13, 2013/14 and 2014/15 indicate that UGX 11.37 billion was allocated for renovation of health facilities, a review of tax expenditure revealed that no taxes had been paid by the Ministry in relation to civil works under the UHSSP. This was attributed to the requirement by the bidding documents that all unit rates by contractors were to be tax inclusive.

By making the unit rates in contracts for works tax inclusive, contract sums rose and as such, the project ended up undertaking fewer health facilities than would have been if the contracts were not inclusive of taxes.

Therefore, had government fulfilled its commitment of contributing USD 12.59 million towards renovation of health facilities through clearing identifiable taxes and duties thereby reducing contract sum, it is likely that an additional two to three (2 to 3) general hospitals would have been worked on.

32 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Recommendation The Ministry should ensure that counterpart funds are availed for project funding.

4.4 POST CONSTRUCTION PREPAREDNESS FOR FACILITIES RENOVATED/ CONSTRUCTED UNDER UHSSP On completion, facilities are handed over to the respective health facility administrations, who are obliged to utilize and maintain the facilities handed over to them. For all the facilities under review, the facility space and service areas have increased and this needs to be complemented with additional resources in terms of manpower and operational budgets for effective utilization and maintenance.

Through a review of the Annual Health Sector Performance Report for FY 2014/15, the following operational data for the facilities under review was obtained as indicated in Table 9 below;

Table 9: Operational capacity of health facilities under review

% Staffing Conditional Number in line with grant Number of Bed S/N Health Facility of Out Deliveries approved estimates admissions capacity patients structure “000”

1 Moroto RRH 44% 817,000 47,526 12,977 100 808

2 Nebbi GH 66% 131,577 49,810 12,667 120 2,367

3 Mityana GH 57% 147,434 64,275 14,535 122 5,763

4 Iganga GH 76% 167,292 148,381 23,624 104 6,481

5 Entebbe GH 75% 67,246 8,268 122 5,158

Kiryandongo 6 53% 140,698 36,146 10,253 104 2,019 GH

7 Nakaseke GH 66% 131,634 53,126 6,594 100 2,309

8 Anaka GH 41% 131,171 26,664 6,415 100 1,178

9 Moyo GH 59% 131,171 50,948 4,456 167 981

Source: Auditors compilation from the Annual Health Sector Performance Report FY 2014/15

A review of the needs assessment reports, revealed that for all the nine health facilities, there was need to increase staffing, staff housing, bed capacity and operational budgets among other things, if the health facilities were to be effectively maintained and cater for delivery of the required health services.

Through interviews with management and a review of the nine health facility budgets and annual plans, audit revealed the following: • Staffing levels had remained the same in all the facilities even when renovation construction works had created new service areas and space. This is exacerbated by the fact that the

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 33 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL new structures have attracted more patients Management response at the completed facilities and the patient The Ministry setup a taskforce comprised of numbers are on the rise. the Ministry of Finance, Planning and Economic • Operational budgets for all the facilities had Development, Ministry of Public Service, the Health remained unchanged despite the fact that new Service Commission, Cabinet Secretariat, Health constructions and renovations have resulted Monitoring Unit of State House which is at advanced into an increase in operational expenses stages of developing a Cabinet Memorandum and specifically bills for cleaning services, water, Concept Paper seeking cabinet consideration and and electricity among others. Audit also noted approval on a number of areas regarding service that the operational budgets were not enough delivery at the health facilities. even before expansion works as all the facilities The memorandum, among others, is to brief the under review had accumulated operational Cabinet on achievements made in the sector and service arrears. seek approval of Cabinet to: • The newly constructed facilities and renovation a) expand the mandate of the General Hospitals works has attracted more patients to the health b) Increase staff facilities yet the bed capacity has remained the c) Increase the recurrent budget same. This has put additional pressure on the In addition, Government provided for Capital already congested wards. Development funds for General Hospitals starting • The shortage and state of dilapidation of staff FY 2014/15 to cater for operations and, maintenance housing in the nine facilities under review had of buildings and medical equipment received minimum attention. Only three health facilities of Iganga GH (4 units), Moroto RRH Recommendation (16 units) and Mityana (6 units) had benefited The Ministry should ensure that adequate measures from construction of new staff housing units are taken in respect of staffing and maintenance while for the remaining six health facilities, services to facilitate effective operation and only 12 staff units in each were renovated yet maintainance of health facilities. the needs assessment reports indicated that shortages and dilapidation of staff housing units OVERALL AUDIT CONCLUSION in all facilities was a major concern. Ministry of Health has undertaken specific These matters came up as a result of limited interventions to increase the availability and involvement of users at the health facilities functionality of health facilities by renovating and in planning and prioritization of works at the constructing the nine health facilities at Entebbe, respective facilities. Iganga, Nakaseke, Mityana, Kiryandongo, Anaka, Nebbi, Moyo General Hospitals and Moroto Regional Consequently, user facilities were reluctant to Referral Hospital. Inadequate planning and needs fully utilize all the newly completed facilities in assessment resulted in design changes which an attempt to keep operational expenses within necessitated contract variations leading to project a bearable range. As such, water borne facilities delays throughout the contract implementation and high energy consuming facilities for instance period .Generally, the quality of works was relatively most water borne toilets for patient wards and good except in a few instances where the quality staff housing remained unutilised. of the concrete used was doubtful. For those Specialized services facilities remained unoccupied facilities which have been completed, the Ministry as the facilities did not have the qualified staff to will have to provide for necessary resources to run them. In addition, the non-improvement in effectively maintain and operate the constructed the state of housing at the health facilities means health facilities. that these facilities ability to attract new staff to fill the existing gaps remains low.

34 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL APPENDICES

FP CC (Accts) (Accts)

FP CC (P) (P)

FP

(HMIS)

CC

(M&E)

FP (M&E)

CC (Bgt) FP (L&SC)

WB

FP (HP) CC (L&M)

PS PC DPC TMC FP (L&M)

FP CC (HI) (HI) UHSSP TECHNICAL SECRETARIAT ORGANOGRAM MOFPED

MOFPED: Ministry of Finance, Planning and Economic Development WB: World Bank PS: Permanent Secretary, Ministry of Health PC: Project Coordinator DPC: Deputy Project Coordinator FP: Focal Person RH: Reproductive Health Management Resource Human HRM: HRD: Human Resource Development HI: Health Infrastructure L&M: Leadership and Management L&SC: Logistics and Supply Chain Management HP: Hospital Policy M&E: Monitoring and Evaluation HMIS: Health Management Information systems P: Procurement ACCTS: Accounts Bgt: Budget

CC FP Notes: • • • • • • • • • • • • • • • • • • (HRD) (HRD)

CC FP (HRM) (HRM) APPENDIX I:

FP CC (RH) (RH)

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 35 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL APPENDIX II: DOCUMENTS REVIEWED

No. Document Purpose

Mid-term review Aide Memoire April 2-12, To obtain status of UHSSP implementation 1 2013 and challenges. Implementation support Missions draft aide Memoire’s (October 1-10, 2012, March Strategic policy direction of GoU in 2 26-April 3, 2012, October 3-12, 2011, April Improving the health system in Uganda. 26-May 3, 2011) Annual Budget Monitoring Reports – FYs To obtain status of UHSSP implementation 3 2009/10, 2010/11, 2011/12 and challenges.

National Development Plan (2009/10 to Strategic policy direction of GoU in 4 2013/14) Improving the health system in Uganda.

Performance and implementation status 5 M&E Quarterly Performance Reports of UHSSP. Audited Financial statements for the Review the financial performance. 6 UHSSP for 24 months period ending 30th Extract financial data e.g. funding. June, 2014 To identify the key objectives of the 7 Project Appraisal Document project, the relationship between the MoH, IDA and the World Bank. State of National Addressee 2009/10, To know if it’s a government priority and 8 2010/11, 2011/12 , 2012/14, 2013/14, how much is to be allocated 2014/15 and 2015/16 The funding and performance of MoH Ministerial policy statements 2009/10, UHSSP and how the project fits into the 9 2010/11, 2011/12 and 2012/13 operations of the health sector and the MoH annual work plan To Understand how the project should be run, understand key processes and the 10 Project implementation manual various key players in the implementation of the project.

11 Procurement plan, To identify the major inputs of the project

Performance and implementation status 12 Mid-term review report March 2013 of UHSSP. To understand the structure of the 13 UHSSP technical secretariat Organogram project and the various roles of officers implementing the project. Consultant and infrastructure department Performance and implementation status 14 Progress reports (From 3rd Quarter 2010/11 of UHSSP. to 4th Quarter 2012/13) To understand the financial systems and 15 Financial Management guidelines processes.

Internal Audit reports and Management Performance and implementation status 16 responses for period ended 30th 06/2014 of UHSSP.

Uganda country portfolio performance Strategic policy direction of GoU in 17 review (CPPR) April 20, 2013 Improving the health system in Uganda. Procurement files and contracts for, design, supervision and renovation and To analyse the procurement process for 18 construction works on-going for the 9 each of the activities. facilities

36 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL APPENDIX III: INTERVIEWS CONDUCTED

S/No. Interviewee/Address Purpose of interview

Knowledge of UHSSP financial 1. Project Accountant/MoH/Kampala performance under infrastructure works

2. M&E specialist/MoH/Kampala Knowledge of UHSSP M&E operations

Knowledge of UHSSP operations under 3 Project Coordinator/MoH/Kampala infrastructure component

4. Project Administrator/MoH/Kampala Knowledge of UHSSP and its operations

Knowledge of UHSSP operations in line 5. Focal Person Health Infrastructure with renovation and construction works

Knowledge of UHSSP procurement 6. Procurement Specialist/MoH/ Kampala operations

Implementing Health Facilities

Contractors for the nine implementing 7. Status of project, challenges health facilities

Consultants for design and supervision 8. Status of project, challenges of works in nine implementing facilities

District and health facility management 9. Status of project, challenges teams for the nine implementing facilities

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 37 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL APPENDIX IV: PROCUREMENT PROCESS

38 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL APPENDIX V: SUMMARY OF FINDINGS PER INDIVIDUAL HOSPITALS Nakaseke Hospital Contract Details

Employer Ministry of Health

Funding Agency World Bank/IDA

Creations Consult Africa Ltd, Edon Consultant International, Sampar Ltd Consulting Design Consultant Engineer, M&E Associates Ltd, DEC Consultants & Air Water Earth

Design Contract No MoH/SRVCS-HI/09-10/000682

Design Contract January 6th, 2011 Signed USD 366,188 (United States Dollars Three Hundred Sixty Six Thousand and One Design Contract Price Hundred Eighty Eight Only) for Lot 1 Supervision Arch Design Limited and Otieno Odongo& Partners Consulting Engineers Consultant Supervision Contract MoH/SRVCS/2013-14/00064-2 No Supervision Contract March 14th, 2014 Signed Supervision Contract USD 521,777.80 (United States Dollar Five Hundred Twenty One Thousand Seven Price Hundred Seventy Seven and Eighty Cents Only)

Works Contractor Yanjian Uganda Company Limited

Works Contract No MOH-UHSSP/WRKS/12-13/0004-2

Letter of Bid Not available Acceptance Works Contract Sign October 29th, 2013 Date

Works Contract USD 5,090,612.33 (United States Dollars Five Million Ninety Thousand Six Hundred Amount Twelve Thousand and Thirty Three Cents) Revised Contract N/A Amount

Commencement Date January 31st, 2014

Contract Period 18Months

Date for Completion 31st July, 2015

Physical Progress 100% Reported

Financial Progress 82.73% (IPC No. 12)

Summary of Findings • The user needs assessment study undertaken by the Consultant was inadequate because the hospital staff were not fully consulted during the planning process to properly inform the architectural and engineering design process. This led to changes in design and variations during construction. • According to Special Conditions of Contract Section 6.4 “twenty percent of the contract sum shall be paid upon submission of an acceptable site survey report”. The Design Consultant was paid USD 73,237.60 (USD Seventy Three Thousand Two Hundred Thirty

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 39 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Seven and Sixty Cents Only) on July 27th 2011 for submission of an acceptable survey report for Lot 1. However from documents reviewed no reasonably acceptable site survey report for Lot 1 (hospitals and HCIVs) has been seen. • The supervising consultant was contracted on March 14th 2014 four months after the works contract was signed (29th October 2013). The Contractor hence worked for 4 months without supervision leading to variations, time delays and risk of poor quality. • As per the latest IPC (No. 12) payments made thus far amounted to USD 4,211,704.61 which represents 82.73% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 361,750.45. • All architectural and structural drawings used by the Contractor were not approved by Nakaseke District Local Government as required under the Public Health Act. • Structural drawings used for construction were not approved by any duly registered professional civil/structural engineer despite having Eng. John Senfuma as a Civil and Structural Engineer on the Consultant’s team.

Kiryandongo Hospital Contract Details

Employer Ministry of Health

Funding Agency World Bank/IDA

Infrastructure Design Forum/Buildcost Associates/M&E Design Consultant Associates/Proman Consults Ltd

Design Contract No MoH/SRVCS-H1/09-10/00682/Lot 2/Phase 1

Design Contract Signed January 6th, 2011

UGX. 1,418,425,000 (Uganda Shillings One billion four hundred Design Contract Price eighteen million four hundred twenty five thousand only) Infrastructure Design Forum/Buildcost Associates/M&E Supervision Consultant Associates/Proman Consults Ltd

Supervision Contract No MoH/SRVCS/2013-14/00064-1

Supervision Contract Signed March 5th, 2014

UGX. 1,222,200,625 (One billion two hundred twenty two million Supervision Contract Price two hundred thousand six hundred twenty five Uganda Shillings only)

Works Contractor China National Complete Plant-COMPLANT Limited

Works Contract No MOH-UHSSP/WRKS/12-13/0004-3

Letter of Bid Acceptance Not available

Works Contract Sign Date October 29th, 2013

USD 5,654,229.90 (United States Dollars Five Million six Works Contract Amount hundred fifty four thousand two hundred twenty nine thousand and ninety cents)

40 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Revised Contract Amount N/A

Commencement Date February 2nd, 2014

Contract Period 18Months

Date for Completion 2nd August, 2015

Physical Progress reported 93%

Financial Progress 70.52%

Time Lapse 114% as at October 6th, 2015

Summary of Findings • On page 18 of the Design Report, the Consultant reports using recommended Design codes (British Standards). No design sheets/calculations were presented as part of the Design Report to enable audit of the logical engineering design process used for the proposed facilities. • According to Special Conditions of Contract Section 6.4 “twenty percent equivalent to UGX 283,685,000/= of the contract sum shall be paid upon submission of an acceptable site survey report.” However, no site survey report for Kiryandongo Hospital were received by the audit team. • It was noted that the geotechnical investigations carried out were inadequate as the report provides only three (3) trial pits. This is contrary to Specific Conditions of Contract – A6 Detailed Scope of Services: bullet f) “Carry out detailed geotechnical investigations prior to the development of the proposed designs • Scope of Services Section J of the design consultancy contract “the Consultant was supposed to support the Client in the procurement of the contractors including preparing responses to queries and corrections to the bidding documents and hence was entitled to 10% of the contract sum upon approval of the bid evaluation report. From review of the documents there is no confirmation that the Consultant was indeed involved in evaluation of the Contractors’ bids for Hospitals and Health Centre IVs under Lot 2. • The supervising consultant was contracted on March 5th, 2014, four months after the works contract was signed (29th October, 2013). Therefore, the contractor worked for 4 months without supervision leading to variations, time delays and risk of poor quality. • As per the latest IPC (No. 9), payments made thus far amounted to USD 3,987,107.51 which represents 70.52% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 190,496.39 • All architectural and structural drawings used by the Contractor were not approved by Kiryandongo Town Council as required under the Public Health Act. • From tests conducted using a Rebound Hammer, the concrete met the minimum strength requirements for class 25 (25MPa). Further tests conducted using the Ultra Pulse Velocity equipment indicated that the concrete properties ranged from excellent to doubtful.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 41 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Mityana General Hospital Contract Details

Employer Ministry of Health

Funding Agency International Development Agency/World Bank

Creations Consult Africa Ltd, Edon Consultant International, Design Consultant Sampar Ltd Consulting Engineer, M&E Associates Ltd, DEC Consultants, Air Water Earth

Design Contract No MoH/SRVCS-HI/09-10/000682

Design Contract Signed January 6th, 2011

USD. 366,188 (United States Dollars Three Hundred Sixty Six Design Contract Price Thousand and One Hundred Eighty Eight Only) for Lot 1

Contract Period Twelve Months

Arch Design Limited and Otieno Odongo& Partners Supervision Consultant Consulting Engineers

Supervision Contract Reference No. MoH/SRVCS/2013-14/00064-2

Supervision Contract Signed March 17th, 2014

USD. 521,777.80 (United States Dollar Five Hundred Twenty Supervision Contract Price One Thousand Seven Hundred Seventy Seven and Eighty Cents Only)

Date for Completion July 31st, 2015

Works Contractor Sinohydro Corporation Ltd

Contract No MOH-UHSSP/WRKS/12-13/0004-1

Works Contract Sign Date October 29th, 2013

USD 6,090,929.55 (United States of America Dollars Six Works Contract Amount Million Ninety Thousand Nine Hundred Twenty Nine and Fifty Five Cents)

Commencement Date February 24th, 2014

Contract Period 540 days

Defects Liability Period 365 days

Completion Date August 24th, 2015

Time for Completion 14 Months 1. T Block 12 Months 2. OPD/Causality & Admin 3. Generator House, Placenta Pit, Medical 4 Months Waste pit, Attendants Kitchen, Attendants Laundry 4. Staff Accommodation – 6 units; 2 8 Months bedrooms

42 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Governing Law Republic of Uganda

Ruling Language/Communications English language

Time Lapse 108% as at October 8th, 2015

Summary Findings • The needs assessment study undertaken by the Consultant was inadequate because the hospital staff was not consulted during the planning process to inquire which structures the hospital urgently needed. This resulted into various design changes and variations during construction. • According to Special Conditions of Contract Section 6.4 “twenty percent of the contract sum shall be paid upon submission of an acceptable site survey report”. The Design Consultant was paid USD 73,237.60 (USD Seventy Three Thousand Two Hundred Thirty Seven and Sixty Cents Only) on July 27th 2011 for submission of an acceptable survey report for Lot 1. However from documents reviewed no reasonably acceptable site survey report for Lot 1 (hospitals and HCIVs) has been seen. • Scope of Services Section J states that “the Consultant was supposed to support the Client in the procurement of the contractors including preparing responses to queries and corrections to the bidding documents hence entitled to 10% of the Contract Sum upon approval of the bid evaluation report. From review of the documents provided there is no confirmation that M/s Creations Consult Africa Ltd was involved in evaluation of the contractors that bid for Hospitals and Health Centre IVs under Lot 1. • From interaction with the Contractor, there were delays between requests for approval and response from the Supervising Consultant; this was attributed to the Clerk of Works lacking the authority to approve commencement and other works. • There was no evidence to determine whether monthly safety and health trainings were conducted by the Contractor. • As per the latest IPC (No. 10), payments made thus far amounted to USD 4,845,968.00 equivalent to 79.56% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 104,445.58. • The total cost resulting from new quantities in the contract was USD 20,015.43 being paid to the contractor without any formal approval from the Client.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 43 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Anaka Hospital Contract Details

Employer Ministry of Health

Funding Agency World Bank/IDA Credit

Infrastructure Design Forum/Buildcost Associates/M&E Associates/ Design Consultant Proman Consults Ltd

Design Contract No MoH/SRVCS-H1/09-10/00682/Lot 2/Phase 1

Design Contract Signed January 6th, 2011

UGX. 1,418,425,000 (Uganda Shillings One billion four hundred Design Contract Price eighteen million four hundred twenty five thousand only) Infrastructure Design Forum/Buildcost Associates/M&E Associates/ Supervision Consultant Proman Consults Ltd

Supervision Contract No MoH/SRVCS/2013-14/00064-1

Supervision Contract Signed March 5th, 2014

UGX. 1,222,200,625 (One billion two hundred twenty two million two Supervision Contract Price hundred thousand six hundred twenty five Uganda Shillings only)

Works Contractor Excel Construction Limited

Works Contract No MOH-UHSSP/WRKS/12-13/0004-4

Letter of Bid Acceptance Not available

Works Contract Sign Date October 29th, 2013

USD 6,545,233.13 (United States Dollars Six Million five hundred Works Contract Amount forty five thousand two hundred thirty three and thirteen cents)

Revised Contract Amount N/A

Commencement Date January 6th, 2014

Contract Period 18Months

Date for Completion 6th July, 2015

Physical Progress reported 100%

Financial Progress 70.68%

Time Lapse 114% as at October 6th, 2015

44 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Summary of Findings • The needs assessment focused on renovations of hospital facilities not building new hospital facilities. The report hence provides dilapidation schedules for the hospital facilities with recommended improvement/maintenance plans. • On page 18 of the Design Report, the Consultant reports using recommended Design codes (British Standards). However, no design sheets/calculations were presented to enable assessment of compliance to logical engineering design procedures. • According to Special Conditions of Contract Section 6.4 “twenty percent equivalent toUGX 283,685,000/= of the contract sum shall be paid upon submission of an acceptable site survey report.” However, no site survey reports for Anaka Hospital were seen by the audit team. • Scope of Services Section J of the design consultancy contract the Consultant was supposed to support the Client in the procurement of the contractors including preparing responses to queries and corrections to the bidding documents and as such was entitled to 10% of the contract sum upon approval of the bid evaluation report. From review of the documents there is no confirmation that the Consultant was involved in evaluation of the Contractors’ bids for Hospitals and Health Centre IVs under Lot 2. • The supervising consultant was contracted on March 5th, 2014, four months after the works contract was signed (29th October, 2013). • As per the latest IPC (No. 8), payments made so far amount to USD 4,626,290.92 which represents 70.68% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 53,220.35. • All architectural and structural drawings used by the Contractor were not approved by Anaka Town Council as required under the Public Health Act. • From tests conducted using a Rebound Hammer, the concrete met the minimum specified strength requirements for class 25 (25MPa). Further tests conducted using the Ultra Pulse Velocity equipment indicated that the concrete properties were doubtful.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 45 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Nebbi Hospital Contract Details Employer Ministry of Health

Funding Agency World Bank/IDA

Infrastructure Design Forum/Buildcost Associates/M&E Associates/Proman Design Consultant Consults Ltd

Design Contract No MoH/SRVCS-H1/09-10/00682/Lot 2/Phase 1

Design Contract Signed January 6th, 2011

UGX 1,418,425,000 (Uganda Shillings One billion four hundred eighteen Design Contract Price million four hundred twenty five thousand only) for Lot2

Infrastructure Design Forum/Buildcost Associates/M&E Associates/Proman Supervision Consultant Consults Ltd

Supervision Contract No MoH/SRVCS/2013-14/00064-1

Supervision Contract Signed March 5th, 2014

UGX. 1,222,200,625 (One billion two hundred twenty two million two hundred Supervision Contract Price thousand six hundred twenty five Uganda Shillings only)

Works Contractor China Railway No.5 Engineering Group

Works Contract No MOH-UHSSP/WRKS/12-13/0004-4

Letter of Bid Acceptance Not available

Works Contract Sign Date October 29th, 2013

USD 3,876,045.19 (United States Dollars Three Million eight hundred seventy Works Contract Amount six thousand forty five and nineteen cents)

Revised Contract Amount N/A

Commencement Date February 24th, 2014

Contract Period 18Months

Date for Completion 24th August, 2015

Physical Progress reported 70%

Financial Progress 38.08%

Time Lapse 114% as at October 6th, 2015

Summary of Findings • The needs assessment clearly focused on renovations of hospital facilities not building new hospital facilities. The report hence provides dilapidation schedules for the hospital facilities with recommended improvement/maintenance plans, etc. • On page 16 of the Design Report, the Consultant reports using recommended Design codes (British Standards). No design sheets/calculations were presented to enable analysis of the engineering design process followed. • Only three trial pits were used for geotechnical investigations. On the site sketch map showing the trial pit locations, none of the three trial pits excavated was in the area of the new OPD. Trial Pit (1) which is claimed, according to the sketch map, to be excavated in the proposed area for T-block extension reports no rock at a depth of 4.1m yet the Contractor reports meeting a rock at a depth of 1m. Therefore, the geotechnical investigations carried out during the design stage were inadequate and contrary to Specific Conditions of Contract – A6 Detailed Scope of Services: bullet f) “Carry out detailed geotechnical investigations prior to the development of the proposed designs.”

46 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL • Scope of Services Section J of the design consultancy contract the Consultant was supposed to support the Client in the procurement of the contractors including preparing responses to queries and corrections to the bidding documents and as such was entitled to 10% of the contract sum upon approval of the bid evaluation report. From review of the evaluation report there is no indication that the Consultant was involved in evaluation of the Contractors’ bids for Hospitals and Health Centre IVs under Lot 2. • The supervising consultant was contracted on March 5th, 2014, four months after the works contract was signed (29th October, 2013). The contractor worked for 4 months without supervision leading to variations, time delays and risk of poor quality. • As per the latest IPC (No. 4), payments made so far amount to USD 1,476,166.00 which represents 38.08% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 219,843.44 • All architectural and structural drawings used by the Contractor were not approved by Nebbi Town Council as required under the Public Health Act. • The Contractual language "English" was dishonoured by the Contractor who deployed a Project Manager (PM) not competent/fluent in the language. Under the Particular Conditions (PC) of Contract, Part A: Contract Data, Ruling language is English and Language of Communication is English. Sub-clause 1.4 of the General Conditions states that “The Contract shall be governed by the law of the Country or other jurisdiction stated in the Contract Data. The ruling language shall be that stated in the Contract Data.” Due tofailure by the Contractor to abide by the Contract Clauses an interpreter was provided for the PM. Although the interpreter was not formally recommended by the Consultant he was found present during the audit interviews. • From structural integrity tests conducted using a Rebound Hammer, the concrete met the minimum strength requirements for class 25 (25MPa). Further tests conducted using the Ultra Pulse Velocity equipment indicated that the concrete properties varied from excellent to doubtful.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 47 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Moyo Hospital Contract Details

Employer Ministry of Health

Funding Agency World Bank/IDA

Infrastructure Design Forum/Buildcost Associates/M&E Associates/ Design Consultant Proman Consults Ltd

Design Contract No MoH/SRVCS-H1/09-10/00682/Lot 2/Phase 1

Design Contract Signed January 6th, 2011

UGX. 1,418,425,000 (Uganda Shillings One billion four hundred Design Contract Price eighteen million four hundred twenty five thousand only)

Infrastructure Design Forum/Buildcost Associates/M&E Associates/ Supervision Consultant Proman Consults Ltd

Supervision Contract No MoH/SRVCS/2013-14/00064-1

Supervision Contract Signed March 5th, 2014

UGX. 1,222,200,625 (One billion two hundred twenty two million two Supervision Contract Price hundred thousand six hundred twenty five Uganda Shillings only)

Works Contractor M/s Prism Construction Company

Works Contract No MOH-UHSSP/WRKS/12-13/0004-6

Letter of Bid Acceptance Not available

Works Contract Sign Date October 29th, 2013

USD 4,541,931.32 (United States Dollars Four Million five hundred Works Contract Amount forty one thousand nine hundred thirty one and thirty two cents)

Revised Contract Amount N/A

Commencement Date February 28th, 2014

Contract Period 18Months

Date for Completion 28th August, 2015

Physical Progress reported 78%

Financial Progress 47.42%

Time Lapse 114% as at October 6th, 2015

48 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Summary of Findings • The needs assessment focused on renovations of hospital facilities not building new hospital facilities. The report hence provides dilapidation schedules for the hospital facilities with recommended improvement/maintenance plans. • On page 18 of the Design Report, the Consultant reports using recommended Design codes (British Standards). However, no design sheets/calculations were presented to enable audit of the logical engineering design process followed. • As per the latest IPC (No.5), payments made thus far amount to USD 2,153,836.98 which represents 47.42% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 34,103.02. • All architectural and structural drawings used by the Contractor were not approved by Moyo District Local Government as required under the Public Health Act. • From structural integrity tests conducted using a Rebound Hammer, the concrete met the minimum strength requirements for class 25 (25MPa). Further tests conducted using the Ultra Pulse Velocity equipment indicated that the concrete properties varied from good to doubtful. • From interview with the Hospital staff, Consultant and Contractor involved in the project, it was concluded that monthly site meetings resulted into decisions that sometimes created numerous variations.

Moroto Regional Referral Hospital Contract Details

Employer Ministry of Health

Funding Agency International Development Agency/The World Bank

Consultancy Firm Arch Design Ltd and Otieno Odongo& Partners

Design Contract No MoH/SRVCS-HI/09-10/000682 (Lot 3), Phase 1

Design Contract Signed January 6th, 2011

USD. 368,360 (United States Dollars Three Hundred Sixty Eight Design Contract Price Thousand and Three Hundred Sixty Only)

Contract Period Twelve Months

Date for Completion January 5th, 2012

Supervision Consultant Arch Design Ltd and Otieno Odongo& Partners Consulting Engineers

Supervision Contract Reference No. MoH/SRVCS/2013-14/00064-2

Supervision Contract Signed March 17th , 2014

USD. 521,777.80 (United States Dollars Five Hundred Twenty One Supervision Contract Price Thousand Seven Hundred Seventy Seven and Eighty Cents Only)

Date for Completion July 31st, 2015

Works Contractor Excel Construction Company Limited

Works Contract No. MOH-UHSSP/WKS/2012-13/0004-7

Letter of Bid Acceptance Not Available

Works Contract Sign Date October 29th, 2013

USD 8,842,878.01 (United States Dollars Eight Million Eight Thousand Works Contract Amount Forty Two Eight Hundred Seventy Eight and One Cent)

Revised Contract Amount N/A

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 49 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Commencement Date 29th January 2014

Contract Period 540 days

Defects Liability Period 365 days

Completion Date 29th July 2015

Time for Completion

1. OPD 12 Months

2. Generator House, Placenta Pit, Medical waste Pit ,Attendants Kitchen, Attendants laundry and 6 4 Months Stance VIP Latrines (2No) 4 Stance VIP latrine (4 No). All these should be handed over together 3. Staff accommodation 3units; 3 6 Months bedrooms 4. Staff accommodation 12 units; 2 6 Months bedrooms Governing Law Republic of Uganda Ruling Language/Communications English language Physical Progress Practical Completion

Financial Progress 67.15%

Time Lapse 111% as at September 29th, 2015

Summary of Findings • As per the latest IPC (No. 9), payments made thus far amount to USD. 5,937,638.82equivalent to 67.15% of the contract sum. The total amount paid includes payments for Variation Orders amounting to USD 41,141.24. • The contract period expired on July 29th, 2015 however works were incomplete by then. The Contractor on June 10th, 2015 requested for extension of time for 90 days from the initial completion date which was received by the Consultant on June 10th, 2015. There is no indication that the request for extension was approved/declined by the Client.

Iganga General Hospital Contract Details

Employer Ministry of Health

Funding Agency International Development Agency/World Bank

Design Consultant M/S Arch Design Ltd and M/s Otieno Odongo& Partners

Design Contract No. MoH/SRVCS-HI/09-10/000682 (Lot 3), Phase 1

Design Contract Signed January 6th, 2011

USD. 368,360 (United States Dollars Three Hundred Sixty Eight Design Contract Price Thousand and Three Hundred Sixty Only)

Design Contract Period Twelve Months

Arch Design Limited and Otieno Odongo& Partners Consulting Supervision Consultant Engineers

Supervision Contract Reference No. MoH/SRVCS/2013-14/00064-2

50 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Supervision Contract Signed March 17th, 2014

USD. 521,777.80 (United States Dollar Five Hundred Twenty One Supervision Contract Price Thousand Seven Hundred Seventy Seven and Eighty Cents Only)

Works Contractor China National Aero- Technology Int. Eng. Corporation (CATIC)

Works Contract No MOH-UHSSP/WRKS/12-13/0004-1

Works Contract Sign Date October 29th , 2013

USD 4,933,884.78 (United States of America Dollars Four Million Works Contract Amount Nine Hundred Thirty Three Thousand Eight Hundred Eighty Four and Seventy Eight Cents)

Commencement Date 31st January 2014

Contract Period 540 days

Defects Liability Period 365 days

Completion Date July 31st, 2015

Time for Completion

OPD/Casualty extension 12 Months

Theatre Block 12 Months

Generator House, Placenta Pit, Medical waste Pit ,Attendants Kitchen, Attendants laundry and 6 4 Months Stance VIP Latrines (2No) 4 Stance VIP latrine (4 No). All these should be handed over together.

Mortuary ( with 9 body fridge) 6 Months

Staff accommodation 4 units(2 6 Months bedroom each)

Remodeling existing OPD 8 Months

Maternity block 8 Months

Antenatal block 6 Months

Governing Law Republic of Uganda

Ruling Language/Communications English language

Time Lapse 108% as at October 30th, 2015

Summary Findings • During the construction several human bodies were excavated since there was a graveyard at the location of the OPD and mortuary block. The presence of the graveyard was not picked up during geotechnical investigations which imply they were inadequate or were not done. It is also surprising that there was no consultation with the hospital staff some of whom had been there for over twenty years and were fully aware of the presence of human remains at the proposed site. This rather macabre and traumatizing situation could have been avoided

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 51 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL if high levels of professionalism had been exhibited by the design consultant. • Structural drawings submitted by the Consultant were not approved by a Structural Engineer and there are no calculations available to back up the detailing in the drawings. • The Contract for Construction Supervision was signed between Ministry of Health and M/s Arch Design and M/s Otieno Odongo& Partners; however in the Contractor’s contract documents prepared by the Client the Project Engineer is stated as Arch Design Limited leaving out Otieno Odongo& Partners. From review of site meetings and the visitor’s book, there is no indication that Otieno Odongo& Partners was involved in administering the contract.

Entebbe General Hospital Contract Details

Employer Ministry of Health

Funding Agency International Development Agency/World Bank

M/S Arch Design Ltd and M/s Otieno Odongo& Partners Consulting Design Consultant Engineers

Design Contract No. MoH/SRVCS-HI/09-10/000682 (Lot 3), Phase 1

Design Contract Signed January 6th, 2011

USD. 368,360 (United States Dollars Three Hundred Sixty Eight Thousand Design Contract Price and Three Hundred Sixty Only)

Design Contract Period Twelve Months

Supervision Consultant Arch Design Limited and Otieno Odongo& Partners Consulting Engineers

Supervision Contract Reference No. MoH/SRVCS/2013-14/00064-2

Supervision Contract Signed March 17th, 2014

Completion Date July 31st, 2015

USD. 521,777.80 (United States Dollar Five Hundred Twenty One Thousand Supervision Contract Price Seven Hundred Seventy Seven and Eighty Cents Only)

Works Contractor China National Aero- Technology Int. Eng. Corporation (CATIC)

Works Contract No MOH-UHSSP/WRKS/12-13/0004-1

Works Contract Sign Date October 29th , 2013

USD 7,034,065.42 (United States Dollars Seven Million Thirty Four Works Contract Amount Thousand Sixty Five and Forty Two Cents)

Commencement Date 14th February 2014

Contract Period 540 days

Defects Liability Period 365 days

Completion Date August 14th, 2015

Governing Law Republic of Uganda

Ruling Language/Communications English language

52 RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL Summary Findings • From the Design Report submitted by the Consultant it was noted that assessment and design were nonspecific since the report keeps referring to other hospitals (e.g. Kawolo and Moroto) rather than specific to Entebbe General Hospital. • Geotechnical investigations were conducted; however, only two test pits were carried out which is inadequate for structures that are occupying an area of 108.68m x 197.6m. • The Contract for Construction Supervision was signed between Ministry of Health and M/s Arch Design and M/s Otieno Odongo& Partners; however in the Contractor’s contract documents prepared by the Client the Project Engineer is stated as Arch Design Limited leaving out Otieno Odongo& Partners. From review of site meetings and the visitor’s book, there is no indication that Otieno Odongo& Partners was involved in administering the contract.

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS 53 STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH | A REPORT BY THE AUDITOR GENERAL THE REPUBLIC OF UGANDA

THE REPUBLIC OF UGANDA

OFFICE OF THE AUDITOR GENERAL

www.oag.go.ug | E-mail: [email protected]

OFFICE OF THE AUDITOR GENERAL

P.O.Box 7083, Kampala, Tel: +256 414 344 340 Fax: +256 414 345 674 E-mail: [email protected]

RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA HEALTH SYSTEMS STRENGTHENING PROJECT (UHSSP), MINISTRY OF HEALTH RENOVATION AND CONSTRUCTION OF SELECTED HEALTH FACILITIES UNDER THE UGANDA SYSTEMS STRENGTHENING PROJECT (UHSSP), MINIST RY

A REPORT BY THE AUDITOR GENERAL

VALUE FOR MONEY AUDIT REPORT ON THE IMPLEMENTATION OF THE EXPRESS PENALTY SCHEME (EPS) VALUE FOR MONEY AUDIT REPORT ON THE IMPLEMENTATION OF THE EXPRESS PENALTY SCHEME (EPS) 1 1 BY UGANDA POLICE FORCE | A REPORT BY THE AUDITOR GENERAL DECEMBER,BY UGANDA POLICE2015 FORCE | A REPORT BY THE AUDITOR GENERAL