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Citizen Weekly

Wednesday, 6 August 2014


A report by Auditor General has revealed financial mismanagement in the Starehe Constituency CDF Fund. The Starehe CDF Committee advertised a tender for purchase of a 14 ton garbage truck vide advert number ST/TR/GRB/12 of 13 July, 2012. Five firms responded and submitted their bids between 7 and 14 May, 2012 while the advertisement of the same tender was dated 13 July, 2012.

The quotations were opened before the tender closing date of 16 July, 2012. Further, the tender was awarded to the second lowest bidder at a sum of Kshs12,950,000.00 instead of the lowest bidder who had quoted Kshs.12,438,840.00. The Constituency may have incurred an apparent loss of Kshs.511,160.00 by awarding this contract to the second lowest bidder. This was in breach of the Public Procurement and Disposal Act, 2005 and Regulations 2006.

Further, Starehe CDF transferred Kshs.5,500,000.00 from the Fund Bank Account to the Garbage Truck Project Management Committee Bank Account which approved an advance payment of Kshs.4,500,000.00 to the supplier of the truck. However, as at the time of the audit, the truck had not been delivered and the supplier was demanding payment of the balance of Kshs.8,450,000.00 which was due. No explanation was provided for the non delivery of the truck.

Again, Starehe CDF Management contracted a Driving School to give 320 people driving lessons at the rate of Kshs.14,950.00 per person giving a total sum of Kshs.4,784,000.00. However, the service provider was not identified through a competitive process contrary to the provisions of the Public Procurement and Disposal Act, 2005. It is also not clear how the 320 people were identified to undertake the training. Consequently, the propriety of this expenditure could not be confirmed.

On the proposed Extension of a Kitchen at Pangani Girls High School Nairobi, the Starehe CDF advertised for the proposed extension of a Kitchen Block on 1 February, 2012. Five firms responded upon which the tender was awarded to a construction firm at a contract sum of Kshs.5,859,647.00. The contract period was 16 weeks commencing on 25 April, 2012 and ending on 25 August, 2012. The contract was however terminated on 16 June, 2012 after the contractor had requested for variation of the contract sum by Kshs.1,996,859.00 (approximately
34.08%) for additional works.

At the time of termination, the contractor had already been paid Kshs.1,177,557.00 excluding retention amount of Kshs.130,840.00. Starehe CDF Committee awarded a second contract for the above mentioned project to a different contractor at a contract sum of Kshs.6,678,945.00. It was however not clear how the new contractor was identified.

 The Starehe CDF Committee is likely to continue incurring losses on this project due to lack of adherence to the procurement procedures.

During the year 2012/2013, Starehe CDF Committee procured 53 plastic tanks, 80 wheelbarrows, garbage collection kits among other items worth Kshs.6,904,890.00 through Starehe/Mathare Environmental Project Management Committee. However, no records were provided to show where the items bought were delivered, casting doubt on proper accountability for the items procured.

In the same year, Starehe CDF Committee approved disbursement of Kshs.51,242,996.00 to Community Based Organizations (CBOs) in the Constituency to implement approved development projects. It was however observed that these CBOs are managed by Project Management Committee members. This is a case of conflict of interest and is contrary to the requirements of the Public Finance Management Act, 2012.