Kilifi County terminates Sh300m revenue collection deal

KILIFI: A court battle is looming between the Kilifi County Government and a private company it had hired to collect revenue. The county wants to terminate the multi-million revenue collection contract issued to Rain Drop Limited last year.

The Sh300 million contract was signed on July 4, 2014 and was, reportedly, cancelled early this week.

On February 16, the county government wrote to the firm citing the termination of the contract after the company failed to meet agreed targets.

A letter signed by the County Secretary Owen Baya, says the company failed to put in place infrastructure like weigh bridges and automated systems for cess collection, parking bays and automated systems for parking fees collections.

"This is to notify you of the termination of the above referenced agreement on the grounds that you have substantially failed to achieve the milestone envisaged in the contract ...," the letter reads in part.

Friday, the CEO of Rain Drop Shaib Hamisi Mgandi, termed the termination as illegal.

Mgandi said in the said agreement, it was stipulated that in case of a disagreement, there should be a declaration of the dispute and the parties involved referred for arbitration.

He said the agreement required the firm to put in place all the infrastructure within two years and wondered why the contract was cancelled only seven months after its signing.

He said the company had already spent more than Sh100 million putting in place the first phase of the infrastructure and the cancellation would translate into losses.