The National Social Security Fund (NSSF) has scaled down the Hazina Trade Towers from 36 floors to 15 albeit at the initial cost of Sh6.7 billion, a report by the Auditor General reveals. However, NSSF acting managing trustee Anthony Omerikwa said the construction had stalled after one of the tenants, Nakumatt Holdings Ltd, took the fund to court.
Omerikwa told the Public Investments Committee (PIC) yesterday that the contractor could not complete the building at its current height owing to structural weaknesses that cannot support the initial planned of 180 metres.
The fund’s management, which appeared before the committee to answer queries by the Auditor General, could not explain why the initial amount of Sh6.7 billion had not been reviewed downwards to commensurate with the reduced scope of work.
“The fund is taking Kenyans for a ride. How can the cost of a 39-floor building be the same as that of 15-floor one? The management is misleading the committee and should be held liable for any monies lost in the deal,” said Chris Wamalwa (Kiminini).
The management team was told to provide the committee with the necessary documents which informed the changes of the project. The committee chaired by Mvita MP Abdulswamad Nassir wants the fund’s management to produce the revised contract terms and the period under which it intends to complete the project.
The fund was also asked to provide the financial appraisal of the contract and the amount paid to the contractor. The Auditor General, Edward Ouko, had queried the construction of the building as well as NSSF links with Nakumatt, which according to him stood in the way of the fund completing the building.
Ouko had advised that the fund take legal action against the tenant (Nakumatt Holdings) to secure completion of the building to safeguard members’ contributions. Omerikwa told the committee that the fund collects Sh 1.1 billion per month from members and that more than Sh762 million was being held in a suspense account.
The money in the suspense account remains unutilised and to this regard the committee directed that the money be remitted to the Unclaimed Assets Authority. Reacting to the cash held in the Suspense Account, Wajir East MP Rashid Amin (Wiper) claimed the funds were being used to finance elections for some candidates.
“It is interesting that figures in the account change during every election year. Could it be that the money is used to finance political activities?” posed Amin. Omerikwa denied the claims. The tender process to select a contractor was also queried and there were allegations that it had been done irregularly.