COORDINATING Minister for the National Covid-19 Immunisation Programme Khairy Jamaluddin today provided a breakdown of the Covid-19 vaccine procurement expenditure, which will cost the government RM5 billion.

His explanation came amid criticism by various politicians and experts on the need to tap into the National Trust Fund (KWAN) to pay for the vaccination drive.

Khairy said the procurement cost for vaccines, which will cover 110% of the population, is RM3.16 billion.

“On December 23, 2020, I announced that the government managed to get access to vaccines from several suppliers, which were enough to cover 82.8% of the population and the total cost was RM2.05 billion,” he said in a statement.

“Taking into account the possibilities of supply disruption, such as export curbs, raw materials, manufacturers capacity and regulatory approval, the 82.8% was then increased to 110%, as announced in the National Covid-19 Immunisation Programme (PICK) guidebook, which was launched on February 16.”

He said Putrajaya will increase the stock if it is later decided that the jab could be administered to teenagers as clinical trials are now ongoing. The extra doses will also serve as booster shots.

The Finance Ministry has capped the procurement cost at RM3.5 billion for now, he said.

“The estimates of the procurement cost are not final. For instance, the government has yet to finalise its agreement with suppliers such as Gamaleya (Sputnik V) and CanSino as the vaccines are still being evaluated by the National Pharmaceutical Regulatory Agency and has yet to be registered,” he said.

He added that the government has the option to discontinue the deal without any financial implication if the vaccines are not approved or if it takes a long time.

The remaining RM2 billion will be spent on other requirements of the national vaccination drive, including vaccine logistics, equipment, rent and utilities, cleaning and sanitisation, outsourcing manpower, data management and contingency plan, among others.

Khairy also reiterated that he and Health Minister Dr Adham Baba had explained the procurement expenditure to parliament’s public accounts committee.

Finance Minister Tengku Zafrul Tengku Abdul Aziz said yesterday that the government will only take RM5 billion from KWAN.

He said the RM3 billion allocation for procurement of vaccines announced when tabling Budget 2021 was not part of the national budget.

Tengku Zafrul assured that the government will not touch the principal, which amounts to RM10.4 billion, and instead the RM5 billion will be drawn out of the fund’s return on investments of RM9.1 billion.

He said the government has limited fiscal space to manoeuvre and has had to tap into the fund instead of borrowing.

He also noted that the RM40 billion debt obligations from 1MDB is enough to cover the cost of vaccines over eight times. – April 27, 2021.