House of Representatives report accuses the Trump administration of ‘waste, fraud or abuse’ in the US fan contract.

Representative Raja Krishnamoorthi, a Democrat from Illinois, questions witnesses during an impeachment investigative hearing of the House of Representatives Congress in Washington, DC, USA, on Tuesday, November 19, 2019.

Jacquelyn Martin | AP | Bloomberg via Getty Images

The United States House of Representatives Oversight Committee accused the Trump administration of “incompetent negotiations” for fans at the start of the coronavirus pandemic, saying it “wasted” more than $ 500 million in taxpayer funds for essential equipment .

“The waste of taxpayer funds caused by the Trump Administration’s incompetent procurement efforts for fans could be up to $ 500 million or more,” according to a report released Friday by President Raja Krishnamoorthi, D-Ill.

The committee said the Trump administration mismanaged an existing contract with Philips Respironics, and agreed to pay $ 15,000 each for Trilogy EV300 fans this year after Philips repeatedly failed to deliver 10,000 Trilogy Evo Universal fans ordered in 2014 for $ 3,280 each. , according to the report.

The committee said there was no evidence that the Trump administration was trying to negotiate a lower price for fans.

The original contract required the 10,000 Trilogy Evo fans to be delivered to the U.S. government by June 2019, according to the report.

“The Trump Administration mismanaged Philips’ repeated failures to comply with contractual requirements. It gave Philips three additional extensions, the last of which allowed delaying final delivery of fans until June 2021,” the report said. “If the Trump Administration had forced Philips to abide by the terms of the Obama-era contract, the country would have had 10,000 fans it needed when the coronavirus crisis occurred.”

Led by US business adviser Peter Navarro, White House officials negotiated a new contract with Philips and agreed to pay almost five times the original price for the equipment, according to the investigation. The new contract required 43,000 Trilogy EV300 fans at $ 15,000, which is also higher than a third model, the Trilogy Evo, which sells for a market price of $ 11,167.

Trilogy Evo Universal and Trilogy Evo appear to be two separate ventilation products. But the committee concluded: “Other than the price, there is no appreciable difference in appearance or functionality between the Trilogy Evo Universal, the Trilogy Evo, and the Trilogy EV300,” the report said.

“The efforts of the Trump Administration constitute more than half a trillion dollars of waste, fraud or abuse. Philips should return the excess so that it can help the nation’s response to the coronavirus pandemic,” the report said.

Frans van Houten, CEO of Netherlands-based parent company Royal Philips, said in a statement on Friday that “he has been transparent about our plans for increased production, pricing and allocation policies. We have cooperated and provided the requested information to the subcommittee. “

Philips Respironics is a subsidiary that sells sleep, breathing, and respiratory care equipment.

Van Houten said the company does not “acknowledge the findings of the subcommittee report, and we believe that not all of the information we provide has been reflected in the report.”

Democrats on the committee said they carried out the investigation to determine why the country was without an adequate number of fans during the “critical first months” of the coronavirus pandemic.

The findings were based on documents and information collected from Philips Respironics, according to the report.

A White House spokesman did not immediately respond to a request for comment.