From abandoned projects with hefty pending bills, uncompensated landowners, Kenya National Highways Authority (KenHa), Kenya Rural Roads Authority (KeRRA) and Kenya Urban Roads Authority (KURA) have been exposed by Auditor General Nancy Gathungu as shall be explained in this article.
According to the auditor, billions have been lost in the process.
Projects where billions of public funds have been lost:
The installation of street lights for the Nairobi-Thika Super Highway where bulbs worth Sh 66.5 million were irregularly procured.
The contract used for the procurement was a three-year performance-based contract signed on 31 December, 2018 at a contract sum of Sh528,599,196, for the maintenance of street lightings on Nairobi-Thika Super Highway (A2) road for a period of thirty-six (36) months.
However, at the time Nairobi Metropolitan Service (NMS) was procuring the lights for installing at the Nairobi -Thika Highway, the contract between KeNHA and the electricals Company was still in force and no evidence was provided for audit review to prove that KeNHA had transferred the contracted services to NMS.
Chuka – Kaanwa Road By Kenha
The audit has also flagged Kenha over the delayed completion of the Chuka – Kaanwa Road at a contract sum of Kshs.233,196,528.
The project was for one (1) year beginning on 7 September, 2022 and was expected to be completed by 7 September, 2023. However, physical verification carried out on 6 November, 2023 revealed that the project was still ongoing and the contractor was still on site despite no extension granted by the Authority.
Kaanwa – Wakathite Road
Awarded in September 2022 at a cost of Sh 221.4 million but construction works have stalled.
The contract for the construction of Wakathite – Kareni Road was awarded at a contract sum of Sh174.4 million and was expected to be complete in September this year. However, work stalled and there is no sign for completion in the near future.
The Nuno- Mondogashe road
The Nuno- Mondogashe road stalled due to delayed payment of approved land compensation. Whereas the National Land Commission had approved payment of land compensation amounting to Sh147. 6 million to the affected persons, an amount of Kshs.125,891,795 was still outstanding.
Cumulative Payments.
The auditor general also disclosed unsupported cumulative payments amounting to Sh 7.6 billion in respect to acquisition of non-financial assets, which includes civil works of Sh 7,250,615,551.
Further, review of the financial statements revealed an outstanding balance of Sh484 million of the financial statements leading to a cumulative project cost of Sh 7. 8 billion.
However, audit examination of the Contract Agreement between the Authority and the contractor revealed that the project contract sum was Sh 7,209,436,067, resulting to unexplained and unsupported over expenditure of Sh525,256,167.
Kenol-SAGANA-MARUA HIGHWAY IMPROVEMENT PROJECT
The auditor noted that there are pending accounts payable balance of Sh 3.2 billion which includes acquisitions of land, construction of roads and consultancy services amounts of Sh 2.8 billion, Sh 342,914,144 and Sh11,594,102 respectively.
Failure to clear pending bills in the year to which they relate distorts the budget of the following year as they constitute a first charge on that budget.
Modogashe Project
The Modogashe project spent Sh 3.8 billion against an approved budget of Sh 5,950,829,860 resulting in an under expenditure of Sh2,132,195,257 or 36% of the budget.
Dualling of Kenol-Sagana (A2) – 48Km Road
The Government of Kenya entered into a contract with an international contractor on 05 August, 2020 for the dualling of Kenol-Sagana (A2) road (48km) at a contract sum of Sh 8.5 billion for a period of thirty-six (36) months.
However, the project has been delayed and is currently at 53 percent completion.
The dualling of the Sagana-Marua (A2) Road Section – 36Km at a sum of Sh 6. 2 billion has however been delayed due to delays in land compensation.
The Nairobi Outering Road project by the KURA
Has a pending bill of Sh 846 million and is still pending completion and according to the auditor it was at risk of incurring additional cost in form of interest and penalties for failure to settle the pending bills which may lead to loss of public funds.
Upgrading of the Kibwezi-Mutomo-Kitui-Migwani Road project
Project valued at Sh18.4 billion by KeNHA has stalled due to non payment of Sh167,855,694 which includes an amount of Sh 32,107,000 which was paid as interest on delayed payments.
Further, an amount of Sh 1.6 billion for acquisition of land from persons who were affected by the implementation of the Project, have not been paid.
Dualling of Magongo Road a project by KeNHA
Project stalled and it reflects payments acquisition of non-financial assets amount of Sh 202,665,451.
Review of records revealed that the balance includes an amount of Sh 24,431,394 in respect of retention amounts for the year under review.
However, Management did not provide any evidence including the copies of interim payment certificates (IPCs) in support of the amount of Sh 24,431,394.
The report reflects on pending bills amounting to bills in relation to construction and civil works, land compensation and supply of services respectively.
The authorities have explained commitment to liaise with The National Treasury to obtain adequate budgetary allocation to secure prompt payment of the pending bills.
On unresolved matters in the audit report of the previous year, a number of issues were raised under the Report on Financial Statements and Report on Lawfulness and Effectiveness in Use of Public Resources.
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