• Boards of parastatals and commissions have created illegal tender committees.
• Unlawful committees have given themselves powers to revoke and approve tenders
Image: COURTESY
Parastatals boards have turned themselves into procurement and tendering committees milking millions of shillings from state-owned institutions, the Star can authoritatively reveal.
In a well-calculated move, the board members have formed powerful tender committees which veto any decisions on plum projects within their institutions.
The unlawful committees have given themselves powers even to revoke and approve tenders that have already been awarded through lawful and competitive bidding.
Numerous interviews with top managers of parastatals and commissions reveal the vice is rife mostly in lucrative institutions with multi-million projects. This has made board membership most coveted and a matter of life and death.
According to the law, boards have no mandate on tendering and procurement, which is the preserve of secretariats with the managing director or CEO being the accounting officer.
The Ethics and Anti-Corruption Commission has come up with an elaborate mechanism to lock out parastatal boards from influencing tenders blamed for driving up corruption in procurement.
In an EACC communication to parastatal and commission chiefs seen by the Star, the anti-graft body confirms receiving complaints of unlawful procurement practices by parastatal boards.
"The commission has received complainants that some state corporations have introduced their own public procurement process and procedures that are not provided for in the Public Procurement and Asset Disposal Act, 2015 and the regulations made thereunder," Twalib Mbarak, the EACC boss, says in the sent out last week.
Some of the state corporations have formed committees and given them titles such as board oversight committee, board endorsement committee and procurement oversight board, the letter says.
"The committees are reported to have given themselves powers to revoke approved procurement tenders that have undergone lawful procurement processes," Mbarak says.
Once a tender is budgeted for and is in the annual procurement plans, the head of supply in an agency initiates the process which must be authorised by the MD/CEO.
The Procurement Act gives accounting officers the sole responsibility of constituting specific ad-hoc committees including Tender Opening Committee, Evaluation, Negotiation, Inspection and Acceptance, Asset Disposals and Contract Implementation Committees in cases of projects that require close supervision and monitoring.
"Therefore procuring entities cannot establish committees which are not provided for in the law or regulation to undertake processes," the letter says.
Mbarak said the directive is aimed at ensuring transparency, accountability and efficiency in public procurement.
'The commission is following up on some of the reported irregularities with a view of taking appropriate action in line with its mandate," he warned.
Some of the parastatals heads who spoke to the Star said board members have informally been influencing tender processing and using this to get kickbacks from bidders.
"They have used tenders and procurement processes as blackmail on us. Where we don't take in their verbal instructions they have always used that as a stick against us, because they appraise us," a CEO told the Star.
"If you don't play ball, they score you lowly and even push you out. Surprisingly, if the tendering process is shrouded in corruption we and other members of the secretariat are left to carry our cross because in law they have no role and thus can't be held to account," another said.
"This directive though coming late from EACC will help shield us from selfish greedy board members," said another.
Some of the key tenders that attract massive interests from board members include insurance cover, construction, premises acquisition, port projects and road construction.