A public procurement board has unearthed a multi-billion shillings scandal at the National Irrigation Board (NIB) for construction of a dam in Turkana County.
The Public Procurement Administrative Review Board (PPARB) questioned how NIB arrived at the decision to award the tender for construction of Lowaat Dam Project at a cost of Sh29.8 billion when the total amount was estimated to be Sh17 billion.
The board had on Thursday nullified the tender awarded to Chinese firm Sinotech Company Ltd, ruling that the process used to award the contract was marred with irregularities, fraud and misrepresentation of facts.
Cracking the whip
“By purporting to change the price set out in the tender documents and introducing different prices at the financial stage of evaluating the tender, we find that the procurement entity (NIB) illegally breached the law by inflating the cost,” ruled the board.
The board’s ruling comes hot on the heels of the government’s decision to crack the whip on procurement processes, which have become an avenue for looting of public funds through inflated costs and irregular procedures.
On Wednesday, President Uhuru Kenyatta ordered that all government tenders --including details of the tender, the costs and the supplier -- must be made public from July 1 in a move aimed at allowing scrutiny of government procurement and prevent fraud.
Already, the court has given a green light to the government’s directive to all heads of procurement and accounting units in ministries and state departments to step aside for fresh vetting and lifestyle audit.
PPARB members -- Paul Gicheru (chairman), Rosemary Gituma, Hussein Were, Nelson Orgut and Paul Ngotho -- found shocking details of how the irrigation board awarded the contract, including inflating figures of the lowest bidder to conceal the fraud.
According to the board, the three companies which were shortlisted for the tender were Sinotech Company Ltd, which quoted Sh29.8 billion, Co-operativa Muratori and Cementisti with Sh34 billion and China International Water and Electric Corp at Sh17.9 billion.
Instead of awarding the lowest bidder, China International Water and Electric Corp, which complied with the tender specifications, the irrigation board faked the quotation of and increased it to Sh29 billion to justify why they settled on Sinotech.
“We find that the figures used in arriving at the final recommendation of award were not the ones set out in the tender documents. We find that the price quoted was Sh17.9 billion, only for the NIB to increase it to Sh29 billion at the last minute on the disguise of correcting errors,” said the board.
They ruled that when it comes to pricing and funding of mega government projects, NIB was bound by public procurement rules which states a bidder is bound by the price set out in the tender documents and cannot change it later.
In addition, the board found not all members of NIB’s tender committee signed the evaluation documents, suggesting only a few individuals participated and agreed to irregularly award the mega tender.
Fresh evaluation
They noted that during the evaluation process, each evaluator did not assign his or her individual score. Neither did they state the reasons and basis of arriving at their decisions, raising suspicion on the conduct of procurement.
“The tender evaluation committee failed to sign all the documents and rendered the entire process vague, depriving it of the necessary transparency as envisaged in procurement regulations,” ruled the board.
The board directed NIB to carry out fresh evaluation of the tenders for the design, building and transfer of Lowaat Dam on the basis of sums set out in the tender documents within seven days.
pogemba@standardmedia.co.ke
