The state underestimated the preparation for a pandemic. Purchases of protective equipment were accompanied by chaos, significant price differences, shortcomings in their quality..

Press release on Audit No 20/32 – 22 March 2021

The state underestimated the preparation for a pandemic. Purchases of protective equipment were accompanied by chaos, significant price differences, shortcomings in their quality, and problems with transport.

The Supreme Audit Office examined the Czech state's response to the COVID-19 pandemic in 2020. Specifically, it focused on the purchase of personal protective equipment (PPE) and medical devices (MD). From 1 January to 31 August 2020, the Ministry of Health (MoH) and the Ministry of the Interior (MoI) paid CZK 8.5 billion for PPE and MD, including transport and related services. The audit showed that the MoH underestimated the preparation for a pandemic of new infectious diseases, for example, it had not updated the Pandemic Plan of the Czech Republic since 2011. The MoH responded with a delay to the lack of protective equipment in healthcare facilities. The purchase of protective equipment itself was accompanied by chaos due to the fact that there were independent purchasing teams at the MoH and the MoI that did not cooperate. Everything then resulted in contractual terms unfavorable for the Czech state, significant differences in the prices of comparable PPE, shortcomings in their quality and problems with transport from abroad.

"The audit results showed that the Czech state underestimated the preparations for the crisis, and the problems in managing the crisis. The aim of our audit is to learn from the identified shortcomings. Therefore, I hope that the information provided by the SAO will actually be applied and will help to ensure that similar events do not surprise us in the future, so that we are ready to respond quickly, meaningfully, and economically," SAO President Miloslav Kala added to the audit results.

The MoH significantly and from the long-term perspective underestimated the preparation of the Czech healthcare system for epidemics associated with the occurrence of new infectious diseases. The Czech state was thus not prepared for the COVID-19 pandemic. Not once has the MoH updated the Pandemic Plan of the Czech Republic since 2011. The state of emergency stocks of PPE and MD, which the State Material Reserves Administration (SMRA) had in its warehouses, did not change from 2011 until the occurrence of the COVID-19 disease. At the end of 2019, 10,000 respirators were available in the SMRA´s stock. University hospitals had less than 5.5 thousand FFP3 respirators in their supply, which was enough for only 20% of professional staff for several hours.

The MoH responded to the shortage of PPE and MD in healthcare facilities with a delay and did not start their purchase at a time when they were still available on the market. The MoH thus failed to purchase sufficient PPE and MD in an open procurement procedure shortly before the announcement of a state of emergency. Following the announcement of a state of emergency on 12 March 2020, the Government of the Czech Republic authorized the MoH and the MoI to make direct purchases of PPE and MD using an exception from the Public Procurement Act. In total, the ministries paid CZK 7.5 billion for PPE and MD. Another almost a billion Czech crowns were paid for the transport of goods and related services.

The unit prices of similar purchased goods differed significantly. The auditors found the most significant price fluctuations for individual types of PPE and MD both at the beginning of the emergency and at the interval of several weeks, when the goods were already more available. In many cases, the ministries accepted in concluded contracts prices of similar PPE and MD that varied in the order of hundreds of Czech crowns per piece, for example, at the MoI, the price of FFP3 respirators ranged from CZK 60 to CZK 422 per piece. At the MoH, the price of FFP2 respirators repeatedly exceeded the unit prices of FFP3 respirators and the price of FFP2 respirators reached up to CZK 777 per piece.

The purchases made by the MoH and the MoI were marked not only by the time pressure and lack of PPE and MD on the domestic and global markets, but also by the existence of two separate teams that did not cooperate with each other. This led to a weakening of the state's position in price negotiations and lower transparency of purchases. The auditors found that the organization of purchases was chaotic with a number of shortcomings in the documentation of individual purchasing steps. According to the auditors, the risk was, for example, that the purchasing teams concluded contracts with suppliers that they had not been demonstrably checked out. All these mistakes resulted in a large price variance, shortcomings in the quality of individual categories of PPE and in the negotiation of contractual terms unfavorable for the state.

The MoH and the MoI paid a total of CZK 987 million for air and rail transport of PPE and MD from China and for related services. They also transported goods for private entities and the costs of this transport amounted to CZK 81 million. It is possible that these costs of the Czech state will not be reimbursed because the terms of payment for transport of the goods owned by private entities had not been agreed in advance in the contract.

The auditors also found a number of shortcomings in the distribution, registration and dispensation of purchased goods. Distribution models of PPE and MD for the case of a pandemic did not initially exist. The audit also showed significant differences in the distribution of PPE and MD per capita between regions. However, the SAO could not verify the distribution to final beneficiaries in regions and municipalities due to its statutory audit scope.

The MoH and the MoI had the quality of respirators checked on the basis of a recommendation from the European Commission by a public research institution. The quality check concerned the supply of respirators without certification recognized by the EU. The MoI often relied on domestic suppliers to supply PPE with a valid certification for the EU market. Therefore, PPE from most of these orders were not tested for quality at all, although the deliveries were not supported by the relevant certification.

The SAO examined part of the test reports on the tested PPE, from orders of 28.3 million pieces worth approximately CZK 1.8 billion. The auditors found that 13.3 million respirators did not pass the tests in the first quality testing. In some cases, the goods from individual deliveries did not match the tested sample, and the goods from some deliveries were not tested at all. There is thus a risk that health and social care workers received PPE that did not pass quality tests.

Details on prices and quality of PPE and MD, transport and other information can be found in the data appendix here:

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