MPs shocker on firm in Sh330m project
Mercy Mwai @wangumarci
A parliamentary committee was yesterday shocked to learn how a company disappeared mysteriously, after it was paid Sh330.5 million to install security equipment at various stadia in the country, ahead of the African Nations Championship (CHAN) that never took off.
MPs who sit in the Public Accounts Committee (PAC) chaired by Ugunja MP Opiyo Wandayi who are scrutinising the 2017/2018 report from the Auditor General, heard how the company known as MS Auditel Limited, went bankrupt and closed its operation in the country despite pocketing the cash for works not done.
The committee was also surprised to learn that the owners of the company, despite leaving the works unfinished, still approached the Ministry of Sports to push for the renewal of their contracts and payments.
CHAN championship was to be held in Kenya in 2018, but was moved to Morocco after the country delayed in the preparation of stadia as advised by Confederation of African Football .
Auditor General Nancy Gathungu in her report disclosed that the firm was paid the Sh330.5 million, which was a 20 per cent advance payment, based on a security guarantee issued by a bank in Madrid, Spain dated October 30, 2017.
The security guarantee was valid up to February 28 , 2018 and had expired at the time of the audit was being done.
“In view of the foregoing, there is a risk of not recovering advanced amount of Sh330,537,997 as the security guarantee had expired and had not been replaced.
It is also not clear when and if the project will be completed considering that the funding was withdrawn by the National Treasury,” reads the report.
The revelations emerged during a meeting of the committee with Sports Principal Secretaries Joe Okudo and his predecessor Kirimi Kaberia after Garrisa Township MP Aden Duale, asked the duo to explain whether they were aware of the said company, as they were unable to locate its owners despite it having physical offices in Lavington and Westlands, Nairobi.
“Are you aware that Auditel had an office in Lavington and Westlands but all of a sudden after being paid disappeared into thin air.
As a committee we were unable to confirm whether this company is in existence or not because we could not even get them to come before us,” he said.
In response, Okudo told the committee that he was not in office when the Ministry paid the money.
He however revealed that some two directors of Auditel, both foreigners, had visited his office last year to discuss their payments and renewal of their contracts despite failing to complete the works given.
He further stated that he turned down the request and wrote to the Attorney General to terminate the contract they had with the government.
“ Last year, two directors of Auditel, who are foreigners came to see me to discuss matters of their payments and renewal of their contracts, this is what forced me to go to the Attorney General’s office to close this deal,” he said.
Kaberia who was the PS when the payments were made was unable to explain how the ministry paid for works never done.
He only explained that the company, together with Gregory International Company, were recommended by CAF and Kenya had no option but to adhere to all the conditions given to them if the country was to host the CHAN 2018.
In their observations, the MPs led by Wandayi said it was evident that some individuals in the ministry were out to siphon money from the government.
The Ministry of Sports had awarded tenders to Gregory International Company and Ms Auditel Limited that involved remodeling of five Stadiums which included Jomo Kenyatta Stadium in Machakos, Moi Kinoru Stadium in Meru, Kipchoge Keino Stadium in Eldoret, Nyayo Stadium in Nairobi, Kasarani Stadium in Nairobi and ten training pitches that were earmarked for use during the championships.
“It is evident that this was a special purpose vehicle manufactured by certain individuals to siphon money from the government,” said Wandayi.