UNCTAD secretary general Mukhisa Kituyi summoned over Sh340m loss
Former Trade and Industry Minister Mukhisa Kituyi will be summoned to appear before a parliamentary committee over a tender he irregularly approved in which the government lost Sh340 million.
Dr Kituyi who is the secretary general of the United Nations Conference on Trade and Development (UNCTAD) sanctioned the contract, which was to cost the government Sh12 million but due to irregularities, ended up costing in excess of Sh352.7 million.
Tourism PS Safina Kwekwe told the Public Accounts Committee (PAC) of the National Assembly that Tele-News Africa and Atlantic Region firm was contracted in 2004 at Sh12 million by the Ministry of Trade and Industry to undertake consultancy services in advertising and promotion of business opportunities in Kenya on behalf of the government.
The committee heard that despite the fact that the contract was supposed to end on June 9, 2004, it was never discontinued with payments irregularly paid.
The firm has continued advertising for the last 15 years of which Sh285 million has been paid. The State currently owes the firm Sh67.7 million in pending debts.
The matter has since been taken over by the ministry of Tourism, which took over the roles, formerly held by the ministry of Trade and Industries.
“The ministry of Tourism has since taken over the baggage and has been paying the debts owed to the consulting firm,” said Kwekwe.
The PS told the committee, chaired by Ugunja MP Opiyo Wandayi, that Kituyi ,who was minister at the time, that he wrote a letter allowing the company to participate in the disputed third phase of the programme.
She, however, said the ministry had written to the Attorney General informing him of the anomaly who instead told them to continue paying.
The AG in the year 2011 wrote to the Ministry of Trade and Industry advising that the contractual amount be paid at a negotiated interest payable. The AG, according to the PS, was silent on the second phase of the contract, which was put to paper.
Following the misunderstanding, the firm went to court to have the government compelled to honour the contract.
A judgement was issued on July 24, 2012 ordering the government to pay Sh110,061,691 which included 26 per cent interest since April 2004.
The firm was paid Sh65 million in July 2013 as interest continued to accumulate. The outstanding bill has since accumulated to Sh245 million.
Committee members asked why the court ruling was contested by the ministry notwithstanding the fact that it was evident that the whole deal was irregular. “The ministry needs to enlighten us on the whole deal which seems to have been shrouded in irregularities,” said Kimani Kuria (Molo).
“This is an Anglo Leasing-like scam,”said Mavoko MP Patrick Makau.
Wandayi noted that due to the ineptness of the ministry mandarins, the government ended up paying interest above interest.
“This is a very serious matter. It is strange that a bill that was to cost the government Sh12 million has gone up to Sh300 million. This is simply fraud,” said Wandayi.
Rarieda MP Otiende Amollo, termed the move by the government to continuing making payments for a contract that had not been since as shocking.
“It is an act of impropriety because you are paying for a contract that was not properly entered into,” said Amollo.