•They were all put on their defence in September after Milimani principal magistrate Anne Mwangi ruled that the state had established prima facie evidence against the accused.
•Obure currently serves as Chief Administrative Secretary in the Ministry of Transport and Infrastructure.
Image: PETER OBUYA
Former Finance Minister Chris Obure on Wednesday put up a spirited fight to discredit abuse of office charges in the Sh928 million Anglo Leasing graft case.
Obure is the third accused in the case alongside former Transport and Communication PS Sammy Kyungu, former Finance secretary Samuel Bundotich and ex-Postmaster General Francis Chahonyo who has since died.
Obure is currently serves as Chief Administrative Secretary in the Ministry of Transport and Infrastructure.
They were all put on their defence in September after Milimani principal magistrate Anne Mwangi ruled that the state had established prima facie evidence against them.
“After evaluating the evidence on record, I find that the state has established a prima facie case against all the accused persons in the case,” Mwangi ruled on September 24.
On Wednesday, Obure took to the stand and told the court that he first got involved in the procurement on May 9, 2002, when he received a letter from then Transport and Communications Cabinet Minister Musalia Mudavadi requesting that he approves single-sourcing and direct procurement for the contract.
The letter said Postal Corporation of Kenya was still largely dependent on Telkom Kenya, a situation that hindered growth and profitability. As such, the state wanted to develop PCK as an autonomous entity and that would require the financial assistance of the government.
The Transport and Communication Ministry said the tender would involve the modernisation of PCK and installation of broadband internet services and fixing computers and faxes in all the over 900 postal offices across the country.
The new equipment would enable the delivery of telegram and electronic services including transfer of salaries for teachers and other public servants.
Only the Finance ministry is mandated to negotiate and enter into contracts with foreign firms on behalf of the government.
Obure said that is why the Transport ministry wrote to him. He sought advice from the procurement director at the Finance ministry.
“I invited the director and shared the contents of the letter with him. It is required that we receive technical advice. That is the way we operate in government,” Obure said.
Four days later, with the advice of the technocrats, Obure wrote back to Mudavadi asking to be supplied with further documents including a copy of the draft contract and details of the terms of the project financing.
He sought justifications for seeking exemptions for direct procurement.
“This would help me analyse and understand the extent of the procurement and whether it fell within the parameters allowed for borrowing,” Obure said.
Chahonyo later wrote to Obure in a letter copied to Mudavadi as the minister for Transport and Communication and his PS Sammy Kyungu detailing why the project was important.
The postmaster general gave the background of the project, saying PCK required infrastructure development to improve data networks and rural internet services.
He said the corporation had strategic infrastructure which was largely dependent on manual operations.
As such, there was the need for technological development that would catapult the agency into profitability.
Chahonyo said PCK was spending Sh300 million annually but argued that the installation and use of satellite services would reduce the costs and generate extra revenues amounting to Sh200 million annually, money he said would sufficiently service the loan.
Obure said the argument looked convincing.
“Your honour, return on investment is a major factor and looking at the project cost of Sh928 million for over 10 years, it would be profitable,” he said.
Mudavadi wrote another letter to Obure detailing justifications for direct procurement.
He said the project involved huge transfers of data and had internal security considerations given the potential threat of computer hackers.
He said there was only one company that could undertake the project given that there was no other potential firm with a license in Kenya.
The argument being it would be time-consuming and expensive to find another firm.
Obure said the Transport and Communication Ministry said the company was a sister firm to that recommended by the UN, a global body for which Kenya is a party.
“There is no alternative supplier. The postal corporation of Kenya cannot realise this project without the involvement of Spacenet,” he said.
The correspondences between the two ministries are part of the exhibits in court with Mudavadi being the prosecution witness number 19 in the case.
Obure also relied on Mudavadi’s testimony that said the correct procedure was followed and that Obure as Finance minister did not act arbitrarily by approving the tender.
Edited by Kiilu Damaris
Image: PETER OBUYA