Auditor General says Kenya lost Sh4.1bn in voter kits purchase

July 1, 2016 6:10 am
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"Direct procurement for ERTS was not justified. As a result of the mismanagement of the procurement process, government incurred an additional Euros 36,989,937.22"/FILE
“Direct procurement for ERTS was not justified. As a result of the mismanagement of the procurement process, government incurred an additional Euros 36,989,937.22″/FILE

, NAIROBI, Kenya, Jul 1 – A joint parliamentary committee looking into a petition seeking the removal of Independent Electoral and Boundaries Commission bosses from office has been told that the country lost Sh4.1 billion (37 million Euros) in the procurement of the 15,000 Biometric Voter Registrations which malfunctioned on election day.

Auditor General Edward Ouko said a Special Audit of the procurement of the election materials revealed that the poll agency did not have a procurement plan which would have been used to guide the process.

Overview
  • Auditor General Edward Ouko said a Special Audit of the procurement of the election materials revealed that the poll agency did not have a procurement plan which would have been used to guide the process.
  • Ouko said the funds lost through the mismanagement by the IEBC could have been saved had the country gone for a competitive tender.
  • "The need for Election Results Transmission System (ERTS) arose from failure by IEBC to plan for the procurement of Electronic Voter Identification Device (EVID) in time. If the EVID had worked previously, then it was not necessary for IEBC to have attempted to procure ERTS."

Ouko said the funds lost through the mismanagement by the IEBC could have been saved had the country gone for a competitive tender.

“The need for Election Results Transmission System (ERTS) arose from failure by IEBC to plan for the procurement of Electronic Voter Identification Device (EVID) in time. If the EVID had worked previously, then it was not necessary for IEBC to have attempted to procure ERTS.”

“Direct procurement for ERTS was not justified. As a result of the mismanagement of the procurement process, government incurred an additional Euros 36,989,937.22, an amount that could have been saved if the process had been properly managed,” Ouko explained.

The Auditor-General in his report also implicated former IEBC chief executive officer, James Oswago, who cancelled the competitive tendering process which had attracted 29 bidders.

The decision resulted to the government-to-government tender, which ended up being more expensive through loan interests and other charges on the Sh6.4 billion the government borrowed from Standard Chartered Bank of London to procure 15,000 BVR kits.

Through the delay in procurement process, the government was forced to purchase 15,000 kits instead at Sh6.4 billion instead of 9,750 kits at Sh4 billion which could have been enough to register Kenyans had the bidding process not been cancelled.

The additional costs on the loan which included bank interests at Sh1.6 billion, and Sh909 million paid as loan insurance premium, to the Canadian firm Export Development Corporation, set the government back over Sh2.5 billion, after the IEBC bungled the competitive bidding process.

The Auditor-General also revealed that the Treasury released Sh192 million more than the amount was required for the BVR kits to the IEBC but that the amount was not spent on the election kits, and it is not known how it was spent.

The tender which was controversially awarded to a Canadian firm, in what the Special Auditor’s report revealed was a process mired in tensions and suspicion between the Commission and its Secretariat.

He told the joint sitting of the Justice and Legal Committee and that of the Constitutional Implementation Oversight Committee, that the chairman and all the commissioners should be held accountable since they were part of the decision making team at the commission.

“There is a collective responsibility that all at IEBC must share due to unclear strategy, planning, budgeting and execution of the March 14, 2013 elections. IEBC as an institution shoulders the residual responsibility of the shortcomings observed during the 2013 elections as most of the procurements were done on ad hoc manner,” Ouko stated.

On single-sourcing of the BVR project to the Government of Canada, Ouko indicates that France had expressed interest, through French firm Safran Morpho which bid to supply 9,750 BVR kits at Sh4 billion.

The French firm was reportedly told it was unsuccessful as the Canadian government had already been engaged.

“The First Secretary of the Canadian High Commission Tim Colby attended a meeting chaired by the IEBC chairman at a time when the country that was to supply the BVR had not been identified,” said Ouko who appeared before the joint House Committee on Thursday.

The petitioner Barasa Nyukuri who is also a consultant and has worked with the IEBC and its predecessors, the Interim Independent Electoral Commission (IIEC) and the Electoral Commission of Kenya (ECK) as a trainer told the joint sitting of the Justice and Legal Affairs Committee (JLAC) and that of the Constitutional Implementation Oversight Committee (CIOC) that he had raised issues around the operations of poll body in 2011 and 2014 but they were ignored.

The Bungoma resident who appeared before the joint House team on Tuesday is seeking the removal from office of Chairman and Commissioners at the IEBC on grounds of incompetence and lack of integrity.

The committee invited the Auditor-General to the sitting after Nyukuri cited as part of his supporting evidence that he has relied on the Special Audit Report on the mismanagement and financial impropriety at the IEBC.

IEBC Chairman Issack Hassan, Vice-Chairperson Lilian Mahiri-Zaja, and Commissioners Yusuf Nzibo, Albert Bwire, Kule Godana, Abdullahi Sharawe, Thomas Letangule, Muthoni Wangai, Mohamed Alawi and Commission Secretary/CEO Ezra Chiloba, will appear before the House committee next week to respond the allegations which have been leveled against them.

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