Govt nod for central agency for healthcare supplies

In a bid to streamline purchase of drugs and vaccines for various disease control programmes, the Government today approved setting up of a new procurement agency for the Health Ministry.

The decision to set up a Central Procurement Agency (CPA) for Department of Health and Family Welfare was taken at a meeting of the Union Cabinet chaired by Prime Minister Manmohan Singh.

The CPA will be a fully autonomous body set up under the Societies Registration Act for efficient procurement and distribution of health sector goods, Information andBroadcasting Minister Ambika Soni told reporters here.

She said a one-time budgetary support of Rs 50 crore has been sanctioned to enable establishment of CPA.

"Thereafter, CPA will charge service fee, which will be well within the overall ceiling of 5 per cent of the value of procurement, to meet its subsequent operational expenses," Soni said.

The CPA will be headed by a Chief Executive Officer who will be in the rank of the Joint Secretary to central government.

The CPA is expected to enable the Health Ministry to efficiently procure and properly distribute quality medicines, vaccines, contraceptives and medical equipment to the state governments and also eliminate shortages and wastages.

The need for a CPA was felt as the current procurement process had certain deficiencies, such as, inadequate professional procurement expertise, absence of supply chain management system, manual collection of data and absence of any credible Management Information System.