How billions are lost in skewed road contracts

The Kisumu-Kakamega road  that stalled for five years because of “heavy and destructive rains” will now cost the taxpayer Sh8 billion up from the initial Sh3.5 billion—an astronomical 78 per cent spike— after varying of the contract.

The revelation, which came during a hearing by Parliament yesterday, blew the cover on rogue Transport ministry officials who have been minting billions of shillings by varying roads projects by either delaying or cancelling contracts.

The committee heard that the ministry, through Kenya National Highways Authority (KeNHA), has been varying some roads projects by as much 80 per cent.

 KeNHA director general Peter Mundinia told the committee that two Chinese contractors hired to construct the Kakamega-Kisumu and Webuye-Kitale highways were demanding  Sh3.5 billion and Sh2.5 billion respectively for delayed payment and change of scope of works over and above the contractual agreements.

“The scheme is planned that you either delay payments or change the scope of work which in turn will see the contractor seeking for more money,” said Paul Katana.      

Infrastructure Principal Secretary Julius Korir sought to exonerate the ministry from blame but Nassir told him the huge variations could not be defended.

Nassir asked Mundinia to explain the criteria used to vary contracts by  up to 80 per cent which is way above the permitted figure of 25 per cent.

Auditor General Edward Ouko had in his 2015/16 report raised concerns in the manner the authority was inflating projects.

On the Webuye-Kitale highway, Mundinia said the contractor is demanding a variation of Sh2 billion with the initial project cost rising from Sh3.4 billion to Sh5.4 billion.

On the 15 kilometre Miritini road, the contract was terminated and awarded  to a new contractor M/S Mehta after varying it by more than Sh200 million. KeNHA terminated the Sh314 million contract and paid Sh144 million for 42 per cent of work done.

In defence,  Mundinia said the figure went up to Sh501 million following a directive by President Uhuru Kenyatta that the work be expedited and that the road  leading to and out of Mombasa port to reduce delays in evacuation of goods be expanded.

 Mundinia said the escalation of project costs were as a result of erratic weather conditions, change in road designs, delayed exchequer releases and delay in acquisition of land for expansion of the roads.

 However members fired back saying the over 70 per cent escalation in project costs cannot be justified through weather conditions, acquisition of land an exchequer releases but conspiracy between contractors and KeNHA officials.

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