MPs query oil supply deal
MPs yesterday heard how the National Treasury irregularly directed the office of the Attorney General (AG) to source oil from the National Oil Corporation (NOC).
The lawmakers were told the directive was made despite the AG’s office having entered into a contract with M/s RH Devani Ltd worth Sh143,844,069.
Members of the Public Accounts Committee (PAC), chaired by Ugunja MP Opiyo Wandayi, were shocked to learn that Treasury had misadvised them during the 2016/17 financial year.
Appearing before the committee to respond to queries raised by the Auditor General, Solicitor-General Kennedy Ogeto regretted that Treasury ignored the framework contract Devani had with the Ministry of Transport to supply fuel to government Ministries, Departments and Agencies (MDAs).
The contract between the AG’s office and Devani, which expired in June 2017, was for the supply and delivery of petroleum products in bulk to the State Law office.
“This is the dilemma we have been having because we already had a binding contract with Devani. A breach of such a contract could have cost the office a huge sum of money,” said Ogeto.
Accompanied by top officials from his office, Ogeto said contrary to the order, Devani continued to supply oil to the AG’s office until June 2017 when the contract expired paving the way for NOC to come in.
He said despite the Treasury asking his office to source for oil from NOC, it did not advise them to nullify the framework contracts they had signed with Devani through the Transport ministry.
MPs sought to know why the office of the Auditor General had declined to inform Treasury of the existence of the contract.
Further, they took Ogeto to task over whether his office explained the potential legal redress, attendant costs and breach of agreement concerns to Treasury.
“Did you notify the Treasury that you already had a valid contract with Devani? Did you inform them of the consequences of the contract if you did not abide by it?” Wandayi asked.
His sentiments came after the Auditor General’s report questioned why the State Law Office went ahead and ignored a government directive that all fuel should be procured from NOC during the year under review.
“It is not clear why government regulations were not followed,” read the report in part.