Masks down: failure of the Polish Sewing Rooms initiative

In April 2020, the Ministry of Development and Technology, originator of the Polish Sewing Rooms initiative communicated that its objective was to produce about 100 million face masks by 200 Polish entrepreneurs. During NIK’s audit, though, the Industrial Development Agency (or: Agency) could not even indicate how many sewing rooms made the face masks it received. Besides, despite guaranteeing this right in the agreements, the Agency failed to verify if all of them were produced in Poland. In other words, it remains unclear if one of original assumptions of the initiative was met.

The NIK Branch in Szczecin conducted an audit in response to media reports saying that millions of unusable face masks were produced as part of the Polish Sewing Rooms initiative for over PLN 250 million. On the other hand, the factory in Stalowa Wola did not make a single face mask. In the first half of 2022 (until June), NIK audited the Ministry of Development and Technology, the Chancellery of the Prime Minister and the Industrial Development Agency. To properly establish facts concerning the selection of face mask providers and the execution of agreements signed with them, NIK auditors requested additional information from 35 non-audited entities, including entrepreneurs, the Governmental Agency for Strategic Reserves, the National Consultant for Infectious Diseases, the Central Institute for Labour Protection, tax offices and the Social Security Institution. Besides, six persons were heard as witnesses.

Because of statutory provisions on the access to public information and fight against unfair competition, concerning two projects: Polish Sewing Rooms and Stalowa Wola NIK cannot reveal all findings related to facts and some of the identified irregularities. The reason is some of the audit results are protected with the company secret.

Execution of agreements as part of the Polish Sewing Rooms initiative

The Polish Sewing Rooms initiative was launched under the Act on special solutions related to the prevention, counteracting and control of COVID-19, which was adopted in March 2020. In line with the agreement signed on 6 May that year, the Chancellery of the Prime Minister outsourced the purchase and distribution of medical protection products used in the fight against the pandemic to the Industrial Development Agency, by the time of cancelling the epidemic threat in Poland.

NIK auditors established that the agreement specified not only requirements related to products provided but also the way of making orders, deliveries and mutual settlements. It also stated that costs would be covered from the COVID-19 Prevention Fund. The role of the Chancellery of the Prime Minister boiled down to financing costs incurred by the Agency and collecting face masks produced. All the Ministry of Development and Technology did was provide offers to the Agency on delivering products of all kinds (including medical and non-medical face masks) and rendering support services. The Ministry sent those offers to the Agency in March and April 2020.

The NIK audit revealed that the way of selecting offers which the Agency received directly from or via the Ministry of Development and Technology was unclear and non-transparent. The documentation collected in relation to the Polish Sewing Rooms initiative lacked confirmation that the Agency analysed those offers. Also, there was no information that would enable establishing who and when decided to sign most agreements with providers or what criteria they used to select the offers.

All in all, in 2020-2021 the Industrial Development Agency bought over 178 million disposable protective face masks, including 105 million medical face masks and 73 million non-medical face masks. The Agency delivered to the Chancellery of the Prime Minister about 105 million medical face masks and about 67 million non-medical face masks for over PLN 313 million (78% of the maximum amount under the agreement).

Provisions in agreements signed between the Agency and face mask providers made it impossible for NIK to establish the total order value because the total amount of compensation for individual providers was defined by the Agency only in 10 of 12 executed agreements.

Production line of protective face masks in the factory in Stalowa Wola

NIK has questioned the adequacy of supervision over the quality of face masks. The NIK audit showed that the Agency outsourced an audit to a logistic company. All the company did was verify the size and shape of face masks and the way straps or elastic bands were attached to them. The company did not check, though, if the delivered face masks met all criteria defined in agreements with providers, e.g. if reusable face masks can be washed in 60°C. It needs to be added that the agreements provided conditions to be met by non-medical face masks in very general terms. They referred to the guidelines of the National Consultant for Infectious Diseases, related e.g. to the fabric weight and washing instructions as well as certificates that the fabrics should have. The guidelines also comprised the size, tying and adjusting of face masks.

Also, radical differences in prices set out in the agreements to produce or provide face masks need to be underlined. In case of medical face masks the discrepancies in contractual price per item reached 40%, whereas in case of non-medical face masks it was nearly 150%. The price was determined among others by whether or not the face masks were made of the producers’ own material or the one provided by the Agency.

Against contractual provisions, the Agency made settlements with two providers that delivered the total of nearly 34% of non-medical masks, based on collective invoices. The Agency did not demand invoices issued to providers by subcontractors. Nor did the Agency demand invoices, based on which subcontractors received money from providers. The audit indicated that no annexes to agreements were signed to justify those practices.

Besides, the Agency received non-medical face masks instead of medical masks from one provider. According to the Agency that was an obvious writing mistake of which it learnt during the NIK audit. NIK did not accept that explanation, though. Since the type of face masks delivered was an elementary part of the agreement, the Agency – as part of proper supervision – should have verified settlement documents from the contracting party and annex the agreement or enforce delivery of products compliant with the agreement.

The NIK audit also showed that the Agency paid 24 invoices submitted by subcontractors of one of its contracting parties without prior adequate verification of the settlement documents. Additionally, the Agency failed to clarify why the invoices were issued to a company that was not its contracting party. According to NIK that situation showed that the documentation was not kept properly and that its management principles were treated as bureaucratic burden.

The Industrial Development Agency failed to reasonably protect its interests, also in the agreement signed with the company which provided logistic services related among others to storing and packing face masks.

As part of the Polish Sewing Rooms initiative, until the end of October 2021, the Chancellery of the Prime Minister provided all the medical face masks it received to governors and the Governmental Agency for Strategic Reserves. The non-medical face masks were sent to the International Solidarity Fund and three other institutions, including the Governmental Agency for Strategic Reserves. The Agency kept the remaining face masks for its own needs or provided them as donations.

Failure of the Stalowa Wola initiative

As part of tasks related to the prevention of COVID-19 epidemic spread, the Industrial Development Agency also performed the Stalowa Wola initiative. Its objective was to gain independence from foreign providers of personal protection products and to ensure proper capacity of the state in this area in the future.

In view of the above the Agency purchased nine state-of-the-art and fully automated production lines prepared to make protective masks of different kinds. NIK auditors confirmed it in January 2022, during an inspection of the shop floor in Stalowa Wola, owned by the Agency.

However, in the first quarter of 2022, the Agency started to move technological lines to Radom, which – according to the Agency – was financially justified. In the opinion of the Agency manufacturing medical products in the shop floor in Stalowa Wola would entail the need to conduct expensive renovation works there, whereas the shop floor in Radom was being modernised at that time and could be adapted to the manufacturing needs.

Despite the fact that the Agency incurred significant costs to implement the Stalowa Wola initiative, the production of face masks was not launched and was finished at the testing stage.


Article informations

Date of creation:
27 March 2023 12:06
Date of publication:
27 March 2023 12:06
Published by:
Marta Połczyńska
Date of last change:
27 March 2023 12:06
Last modified by:
Marta Połczyńska
A sewer making protective face masks on sewing machine © Adobe Stock

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