Fresh details have emerged of how taxpayers could be losing billions of shillings in irregular procurements and payments in the counties.
Auditor General Gathungu in a
new report has exposed how county administrations are dishing out tenders worth millions in disregard
of the law.
The audit reports for county executives for the period ending June 30,
2024 reveal that counties routinely
violate, ignore or manipulate public
finance and procurement laws.
The report exposes what appears
to be systemic omissions and commissions by the procurement and finance officers, thereby putting
public money at risk of loss.
In revelations that put the governors in the spotlight, the counties
exploit provisions on restricted tendering to dish out awards to specific
firms.
In addition, procurement and
finance officers vary contracts, ballooning the value beyond the required percentage.
In Kiambu, the
auditor exposed how the county
awarded one supplier 70 per cent of
contacts for motor vehicle routine
maintenance.
“It was noted from the review
of sampled payment vouchers
amounting to Sh12.86 million that
one supplier was awarded almost
70 per cent of the work, although
the executive had a pre-qualified list
of suppliers under the category,” the
report reads.
Further, the same company was
awarded contracts totaling Sh4.43
million by the health services department.
In all instances, the report shows
only three bidders were requested to
submit quotations with the awarded supplier consistently emerging as
the lowest bidder and therefore the
winner.
This indicated a lack of bidder
rotation in a request for quotations.
Further, the county has been fingered for varying contracts for the
construction of drainage channels
at St Joseph the Worker Catholic
Church Mwihoko and construction
of Mwenjera slopes at Mwenjera
Kambi Ya Pili shopping centre Road
at a contract sum of Sh8.32 million.
“The contract was varied upwards by an amount of Sh6.44 million within 12 months of signing,
which resulted in an increment of
the contract price by more than 25
per cent and such variations were
not tendered for separately as required by law,” the report says.
In Kwale, the auditor flagged
irregular procurement for the construction of roads.
The government
incurred Sh46.42 million on grading and upgrading of roads.
However, the agreement did not
show the procurement number,
which is a crucial reference for
tracking and auditing the procurement process.
Further, the road drawings issued during the procurement process
were similar to those used in other
road projects.
“This was contrary to section
149 of the Public Finance Management Act, 2012.”
The act stipulates that the responsibility of an accounting officer is to
ensure the resources of the entity for
which the officer is designated are
used in a way that is lawful and authorised.
Gathungu also flagged irregular
procurement for consultancy services, where the county paid out
Sh6.50 million to three companies.
However, the reports show that a
review of the procurement records
revealed that all the tender opening
committee members were involved
in the tender evaluation.
This is contrary to section 78(1)
of the Public Procurement and Asset Disposal Act, 2015, which states that at least one of the members
shall not be directly involved in the
processing or evaluation of the tenders.
Further, Gathungu flagged irregular procurement for internet
services for Sh6.46 million as well
as procurement and payment of
Sh71.57 million to six law firms.
In Tana River, Gathungu spotlighted irregular procurement of
non-pharmaceuticals valued at
Sh26.2 million.
The items were procured from
suppliers not registered with the
Pharmacy and Poisons Board.
There was no value-for-money
assessment for framework agreements exceeding one carried out,
professional opinion was not dated
or stamped by the head of procurements.
“In the circumstances, the purchase of non-pharmaceuticals amounting to Sh26.2 million may
not have met the required quality
standards,” the report states.
In addition, the auditor exposed
the irregular purchase of Sh5.89
million in animal vaccines and
drugs.
The vaccines were procured
from an unregistered supplier.
Other irregularities involved the
rehabilitation of Sera road in Garsen North ward for Sh17.2 million
and Makerere road at Kinakomba
ward for Sh14.57 million.
Also flagged is the procurement
for consultancy services valued at
Sh36.8 million.
This related to professional services for boundary surveys for community land and preparation for a land use advisory plan.
The revelations expose procurement as one of the key departments
where corruption thrives in the devolved units.
Indeed, a 2021 finding by the Ethics and Anti-Corruption Commission identified human resource and
procurement departments as the areas most rocked by corruption.
The cases in which former governors Ferdinand Waititu (Kiambu)
and Moses Lenolkulal (Samburu) were convicted of graft involved
procurement.
Lenolkulal was convicted of
pocketing more than Sh83 million
from the county for the supply of
fuel and oil products through proxies.
Waititu, on the other hand, was
found guilty in a Sh588 million
corruption case involving procurement.
In Bomet, Gathungu found irregularities in procurements for
the construction of the 1.9km Magiger-Kipkelei-Cheramogi road for
Sh3.23 million and the Kiswahili-Njerian bridge for Sh4.97 million.
Others were the Nyatembe-Tilanik Fashion Road for Sh2.95 million,
the 2.6km Mocheiket road and the
rehabilitation of Zero Two steel
footbridge for Sh3.82 million.
The auditor also flagged irregularities in the procurement of
Crawler excavators, motor grades
and a drum roller for Sh244.42 million and tippers and a prime mover
for Sh61 million.
This was the case in Vihiga where
the county was agged for irregularly procuring motor vehicle insurance for Sh30.64 million and the
purchase of non-perishable foodstuffs for Sh108.71 million.
In Lamu, the auditor exposed
various irregularities in the procurement of goods and services valued
at Sh635.38 million.
They include the purchase of fuel,
oil and lubricants for Sh81.59 million, foodstuffs for Sh136.68 million and consultancy services for
Sh66.71 million.
The auditor exposed irregular
variations of the contract on the
construction of the Faza desalination plant.
The county paid Sh7.52 million,
out of which Sh3.97 million was in
respect of price variation.
Gathungu also highlighted anomalies in the procurement of Sh19.77
million computers, laptops, printers and photocopiers and certified
seeds, breeding stock and live animals for Sh31.93 million.
In Uasin Gishu, the auditor found
irregular procurement of employees’ insurance covers for Sh297.39
million.
Out of the amount, the county
executive paid Sh36.95 million to
two companies.
One of the firms
had not paid any claims 10 months
after the contract was signed.
“In the circumstances, the value
for money paid for insurance policies and the effectiveness of the insurance policies could not be confirmed,” the report reads.
Further, Gathungu flagged irregularities in the rehabilitation of
civil works, the purchase of mobile
phones and laptops and consultancy services.
In Nakuru, there were irregular
purchases of drugs and medical supplies for Sh51.60 million while in
Narok, the county irregularly hired
ambulance services for Sh63.26 million.
In Kajiado, the government irregularly paid Sh79.13 million to law firms that were directly procured
without prior approval of the accounting officer and no proof of
urgency was provided.
The county also paid Sh5.62 million for an undelivered motor vehicle, contrary to provisions of the
PPAD Act.
