Road agency on the spot over Sh13b
The Kenya Urban Roads Authority (KURA) is on the spot over the construction and improvement of three roads projects amounting to Sh13.2billion.
The projects in question include the establishment of bus rapid transit line 5 worth Sh6.5 billion, the Nairobi intelligent transportation system establishment and junction’s improvement project phase 1 worth Sh6.7 billion and the Nairobi Outering road improvement project.
In her latest report for the financial year 2022/2023, Auditor General Nancy Gathungu in particular took issue with how the government entered into contracts with an international company for consultancy for two of the projects —the establishment of bus rapid transit line on May 24, 2022 for a period of 39 months from the date of commencement and the Nairobi intelligent transportation system establishment and junction’s improvement project phase on May 5, 2022 for a period of 34.5 months from the date of commencement.
The report is likely to put the roads agency in the crosshairs of the Executive, coming only days after President William Ruto directed all state agencies with non-compliant reports from the Auditor-General and the Public Service Commission (PSC) to submit corrective action in the next 21 days.
Gathungu fingered the roads agency for including an irregular clause on financing agreement between the government and the financier.
She revealed that a review of Part lV and Schedule 4 of the Project’s Financing Agreement shows that suppliers other than nationals of the Republic of South Korea or judicial person incorporated and registered therein were not allowed to bid for consultancy services.
This, the report notes is contrary to Section 60(1) of the Public Procurement and Asset Disposal Act, 2015 which states that an Accounting Officer of a procuring entity shall prepare specific requirements relating to the goods, works or services being procured that are clear, that give a correct and complete description of what is to be procured and that allow for fair and open competition among those who may wish to participate in the procurement proceedings.
Reads the report: “In the circumstances, the management of the project and the National Treasury were in breach of the law.”
Last week, Ruto raised concern over the level of non-compliance with constitutional mandates uncovered by the two institutions in their annual audits.
President Ruto disclosed that only 24 per cent of government institutions have received a clean bill of health from the PSC and the Auditor-General.
He said the trend is unacceptable and amounts to impunity that can no longer be tolerated.
“We cannot deliver to Kenyans when we are burdened with impunity and wounded by non-compliance,” he said.
Speaking during the Third National Wage Bill Conference 2024 at the Bomas of Kenya, Nairobi, Ruto said he expects radical improvement in future audits by all government ministries, departments and agencies.
With regards to the establishment of bus rapid transit line 5 project, the report raises concern over delays in commencement of the works despite Sh174.9 million being set aside for the acquisition of non-financial assets which relates to design, review and supervision of works.
The report states that although the project was for a duration of three-and-a-half years from June 2022 to December 2025, as at 30 June, 2023 only an amount of Sh163.6 million or 2.5 percent of the Development Partner’s commitment of the Sh6.5 billion had been received by the project.
The low absorption of the development partner’s loan budget was attributed to failure to commence the works component in the financial year 2022/23 which was expected to consume the highest amount of the loan facility.
Reads the report: “In the circumstances, there is a risk that the project delivery will be delayed because of the delay in commencement of works which may have an impact on service delivery.”
