• The contractor has cited delayed settlement of seven interim payment certificates.
• Also over-deducted retention fees, non-extension of preliminaries, non-payment of fluctuations in prices, non-payment of interest on delayed payments and over-deducted taxes.
Image: HILTON OTENYO
Work on the Sh6.2 billion Kakamega County Teaching and Referral Hospital has been stopped over pending bills.
The contractor, China Railway Jiangsu Engineering (East Africa), has written to the county government notifying it of suspension of works over delayed settlement of seven interim payment certificates.
The contractor cited over-deducted retention fees, non-extension of preliminaries, non-payment of fluctuations in prices, non-payment of interest on delayed payments and over-deducted taxes.
"Please note that the full suspension of site operations for all construction works takes effect on February 1, 2021, should the above issues remain unsettled," the notice dated January 27 read. It was signed by project manager Wang Xin.
"The issues raised should therefore be resolved as soon as possible so that we don't invoke sub-clause 33.1 of the conditions of the contract. Your timely settlement of the outstanding payments and response to this request will be highly appreciated," the notice read.
The notice was copied to county health executive Dr Collins Matemba, chief officers Dr Brenda Barasa (Health Projects) and Fanuel Wemali (Medical Services) and Arch Kanja-Dama Services QS Njoroge-Integra Consulting Limited.
The first phase of the 750-bed capacity hospital is to cost Sh2.5 billion. The contractor has raised 50 interim payment certificates for work done totalling Sh1.9 billion. The county government is yet to settle close to Sh500 million.
In a separate letter dated the same day, the contractor said the company was entitled to be paid simple interest on the late payment in accordance with the General Conditions of the Contract Sub-Clause 23.3.
"We therefore wish to apply for the accrued interests on these delayed payments amounting to Sh25,291,602.86 as at 27th January 2021," Xin said.
Matemba yesterday confirmed that work had been suspended and said the county government was in the process of making payments, so the contractor could return to the site.
"The hospital is being built using conditional grants and part of the money was received last week. We're in the process of paying some Sh100 million and the national government is paying some certificates worth Sh69 million," he said.
"You know that Covid-19 pandemic affected our local revenue and the county has not been receiving funds. What we collect locally cannot finance a project of that magnitude."
He said the national government only remitted the normal monthly disbursement for three this financial year.
The hospital is one of Governor Wycliffe Oparanya’s flagship projects. Once completed, it will serve not only residents of Kakamega county but the entire former Western region since it will be the only level 6 hospital in the area.
Currently, residents of Kakamega, Bungoma, Busia and Vihiga counties seeking specialised medication have to either travel to Moi Teaching and Referral Hospital in Eldoret or Jaramogi Odinga Odinga Teaching and Referral Hospital in Kisumu.