Kakamega construction sector up in arms over diverted funds
Players in the construction industry in Kakamega are crying foul after claims that the county government diverted Sh600 million budgeted to clear payments for completed projects.
The money was allegedly used on hospitality, travel, entertainment and public participation activities.
The funds had been credited to the county government’s construction retention payment accounts at the Cooperative bank where the Treasury raided the kitty for use on the governor’s public participation forays, settle hotel bills, per diems for workshop, travel imprests and salaries for casual workers.
Project completion
A construction retainage payment is normally the 10 per cent of a project cost held back by a client as security for a maximum of six months after completion of a project. A contractor may forfeit the retainage payment if he is unable to address structural issues that may emerge on a project within six months after completion.
Kakamega county secretary Lawrence Omuhaka confirmed in an interview that Sh600 million construction retainage was diverted to cover recurrent expenditures.
Some contractors have accused the Treasury over the alleged selective manner bills are being settled.
They also accused the Treasury of turning the retainage fund into an interest free soft loan advance from contractors.
Kakamega Governor Fernandes Barasa (pictured) last month appeared before a Senate committee on finance and budget, where he tabled documents indicating a pending bill of Sh1.46 billion. Some creditors have challenged the list as inconclusive.
Omuhaka defended treasury claiming the new administration inherited a pending bill of Sh981 million and a dozen multimillion incomplete projects. future jobs.
