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Sh700M SGR feasibility studies money not misappropriated, EACC confirms

by The Informer
January 26, 2017
in News
Reading Time: 2min read
Sh700M SGR feasibility studies money not misappropriated, EACC confirms
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The Ethics and Anti-Corruption Commission (EACC) has established that Sh700 million initially meant for carrying out feasibility studies of the Standard Gauge Railway (SGR) project between Mombasa and Malaba was not misappropriated.

In its third quarterly report for July 2016 to September 2016, EACC says it commenced investigations upon receiving allegations that Sh700 million for the SGR project had been embezzled.

The report says that part of the money – Sh4.2 million- was spent for advertisement of international tenders, bidders’ conference and evaluation before the Kenyan Government entered into a Memorandum of Understanding (MOU) with its China counterpart.

The anti-graft body noted that their investigations revealed that Sh415.9 million was spent to pay off claims submitted by the concessionaire in respect of damage caused to the railway line.

It adds that the concession agreement mandated Kenya Railways Corporation to hold the remaining balance of Sh279.8 million in its pool account.

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“A report was compiled and forwarded to the DPP on July 14, 2016, recommending that the file be closed but advisory be issued to the KRC and the National Treasury to come up with watertight systems that would ensure safety of the public funds,” read the report in part.

It continued: “Investigations revealed that there was no misappropriation of funds”.

On October 12 last year the Director of Public Prosecution (DPP) accepted recommendations fto have the file closed.

The same report revealed that there was breach of Law in the procurement process that led to the award of contract to supply of training materials to Blue Star companies and other at a cost of Sh46.6 million.

EACC established that there was no budget factored in the relevant financial year for the procurement and no requisite market survey done to ensure that NYS received value for money spent on the materials.

The investigations also showed that the private enterprise was not properly qualified for award of the tender and that the user department did not issue any requisition for the said procurement.

On September 22 last year, EACC wrote to DPP recommending that the Accounting Officer of NYS be charged with a count of engaging in a project without prior planning and another of willful failure to comply with the law relating to procurement.

The report also recommended that the Head of supply chain department with two counts of willful failure to comply with the law relating to procurement.

EACC also recommended that the members of Ministerial Tender Committee in the ministry of Devolution be charged jointly with two others with two counts of willful failure to comply with the law relating to procurement.

The NYS Supply Chain Assistant would also be charged with the count of fraudulently practice in procurement.

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