Speaking to FMT, he said the Health Ministry got its supplies and services from crony companies which would typically charge exorbitant prices.
“There are crony companies in nearly every facet of the health industry in the country,” said Jeyakumar, who is a practising doctor.
“We don’t buy our medicines directly from the pharmaceutical companies,” he said. “We buy them from crony companies, which would then mark up the prices.
“We buy all our equipment through crony companies. We even buy books through crony companies. We have even privatised the laundry and cleaning services.
“A large part of the budget goes to inflated expenses because we want to help those companies make profits.”
He said even the construction of hospitals and clinics and repairs and renovations were done through crony companies.
Part of the problem, he said, was that the government had become too focused on building a class of Bumiputera entrepreneurs and was trying to do this “by hook or crook”.
“There’s nothing wrong with this agenda in itself,” he said. “It’s not a bad thing. If you want to have a free market economy, then you need to have all races involved in entrepreneurship.
“The problem is that you’re doing it through the budget allocated for health. A significant part of it is going towards building these entrepreneurs. It’s just not right that this agenda should cause a cutback on health services. There’s a failure to recognise this fact.”
He theorised that if there was enough political will to stop pampering these crony companies, then the existing budget could adequately cover all the Health Ministry’s needs. “But as it stands,” he said, “a bigger budget is needed.”
He called for audits to find out how much these companies were profiting from marked up prices.
“In fact, there shouldn’t be any markup because these guys who are supplying to government hospitals will be able to negotiate for wholesale prices, which would be lower than the market rates.”
He also said that the sheer quantities of supplies to the Health Ministry would bring into play the economies of scale, enabling much cheaper pricing.
In the 2016 national budget, RM23.031 billion was allocated for health. This was RM269 million less than the allocation for 2015.