Mystery of missing files in the Arror, Kimwarer scam
Report of a technical committee formed to establish practicability of the Kimwarer and Arror dams projects is missing and cannot be traced by Government officials.
The committee was commissioned by President Uhuru Kenyatta to ascertain viability of the Sh50 billion projects.
By the time of cancellation of the projects, more than Sh7.5 billion had been spent but there was nothing to show on the ground. Infrastructure Principal Secretary Paul Maringa, who chaired the committee, presented the report to President Uhuru on September 18, 2019, in an event covered live by the media.
A parliamentary committee was shocked last Thursday after it emerged that the whereabouts of the report is unknown. Appearing before the Public Accounts Committee (PAC), Regional and Northern Corridor Development Principal Secretary Dr Belio Kipsang, said he has never seen the report despite the fact it is supposed to be in his custody.
Committee, chaired by Ugunya MP Opiyo Wandayi heard that neither State House, National Treasury nor the Water, Sanitation and Irrigation ministry know where the report is. “What I can confirm to this committee is that I have never seen the said report,” Dr Kipsang told the committee.
It also emerged that the advance payment guarantees to the contractor of the two projects were financed by a commercial loan from a Brazilian bank.
The PS did not, however, give details regarding how the Sao Paulo-based bank ended up funding the project. The money was paid to CMC Di Ravenna, an Italian company that was the main contractor.
Committee had recommended termination of the two projects on account that they were overpriced and hence not viable.
The technical team, however, recommended that the Arror dam proceed but reduced its cost from Sh28.3 billion to Sh15 billion. Kipsang told the committee that by the time CMC Di Ravenna was filing for bankruptcy, Sh4.1 billion had been paid to Heritage Insurance Company as security guarantee for the Arror dam and Sh3.4 billion to Standard Chartered Insurance company for Kimwarer.
The PS told the committee that he had written to the Head of Public Service Dr Joseph Kinyua requesting for the report.
But to his bewilderment, Kinyua denied having the report and instead referred him to the Ministry of Water.
“The Head of Public Service in his response, said he was not in possession of the report and asked me to check with the Ministry of Water,” said Kipsang.
Committee members, confused by the PS’s response, asked him to explain how such a report could go missing without the knowledge of officers heading those offices.“A task force is set up by the President. It puts together a report, hands it over to the President in the full glare of the cameras. But now we can’t lay our hands on that report, not just as citizens but as Parliament,” said Wandayi.
Kipsang later wrote to his counterpart in the Ministry of Water, Sanitation and Irrigation Joseph Irungu requesting for the report as directed by Kinyua.
“I wrote to my colleague in November last year but to date no response has been forthcoming,” Kipsang told the committee. Garissa Township MP Aden Duale asked the PS to go back to Kinyua and inform him that you had hit a snag.
“You should have made some efforts to go back to Kinyua and update him on the progress made,” Duale said.
Wandayi warned the PS that he risked being named if he does not produce the report to Parliament within the next one month. “This committee is taking great exception to the fact that it is unable to get a report from you, a report which is in the public domain despite several reminders,” Wandayi said.
Kipsang promised to go back to Kinyua and inform him on what he had gone through and ask for his assistance as the head of Public Service.
The PS revealed that the government had recalled the Sh4.1 billion advance payment to Arror dam after it expired on December 31, 2021.
He, however, told the committee that he could not confirm that the money had been deposited with the Central Bank of Kenya.
And even after having been paid by the Kenyan Government for works that never commenced, CMC Di Ravenna went on to sue the country at the International Court of Arbitration for irregularly cancelling the contracts for the two projects.
Surprisingly, CMC Di Ravenna has since filed bankruptcy proceedings against itself.
Rarieda MP Dr Otiende Amollo questioned how the company could sue the country yet it had filed for bankruptcy proceedings. “This is the puzzle we are in legally, if you have sought to be declared bankrupt or you have been declared so, you have no capacity to sue,” Amollo said.
Committee had also established that no current reliable feasibility study had been conducted on the Kimwarer project.