- Auditors raised multiple questions on fat tenders floated by the State agency whose monthly revenues hit Sh50 billion in July last year.
- Top among the audit queries are Sh100 million spent on three contracts to put up perimeter walls around various plots owned by KPA.
An audit query has put the Kenya Ports Authority (KPA) on the spot, with fears that millions of shillings may have been lost in questionable tenders and payments for services never delivered.
From building contracts that were paid for but could not be physically verified to water supplied without delivery notes, and which cost more than double what was budgeted for, the State is fighting accusations of dishing out several tenders irregularly.
KPA managers are also on the spot for frustrating auditors who were trying to verify various construction works for which Sh2.3 billion was spent as part of the close to Sh5 billion worth of suspicious tenders at the State agency.
“During the course of the audit, efforts to verify the existence and occurrence of these works was not possible since the management failed to facilitate the physical verification of the works,” auditors wrote concerning five works listed in KPA’s financial statements.
One item is simply marked ‘other works’ for which Sh98 million was spent.
Although KPA dismissed the allegations of tender improprieties and defended the payments made to the various contactors, the auditors raised multiple questions on fat tenders floated by the State agency whose monthly revenues hit Sh50 billion in July last year.
Top among the audit queries are Sh100 million spent on three contracts to put up perimeter walls around various plots owned by KPA. Auditors maintain that the walls were never erected.
KPA first contracted two firms to fence its land parcel number MN/111/528 in Takaungu, Kilifi County, at Sh71.3 million.
Thereafter, the agency paid another Sh24 million to fence another plot in Jomvu.
The auditors questioned how the firms were identified for the jobs as much as the fences do not exist on the ground.
KPA head of Corporate Affairs Bernard Osero, in response to the Sunday Nation’s queries on the perimeter walls, said one of the plots had completely been fenced but vandals destroyed it.
KPA reportedly did not discover when the vandalism was going on and all the materials were stolen.
“The plot was bought in 1993 and is currently occupied by squatters. The contractor, having accomplished their work, were paid accordingly.
"However, a few weeks later, squatters vandalised the wall and took away materials without KPA’s knowledge. KPA was surprised on learning that the wall had been brought down by vandals and squatters,” Mr Osero wrote in response.
The Jomvu plot is said to have suffered the same fate while 70 percent complete.
Both contractors had been fully paid but the auditors maintain that no fence was ever erected.
Auditors also suspect a scheme to swindle some Sh10 million said to have been spent on Pilot boat- Nahodha II.
Mantrac Kenya Limited was hired to do a complete overhaul of the vessel at Sh17.3 million after it attained its 10,000 running hours.
The firm requested for additional spare parts of Sh9.6 million, a request KPA managers approved without even giving their technical department an opportunity to verify if there was need for the extra parts, an oversight the agency admitted.
The engine’s cylinder head, said to have been faulty and which was replaced, had also not been returned to the authority as evidence of replacement by the time of audit.
KPA insists that although it was not produced for audit verification, the cracked cylinder head was returned to the dockyard on December 17 last year.
The auditors were also shocked to find the Local Service Order for the additional parts was dated five days after the invoice used to pay for the parts, indicating that the work was done before approval was made.
“KPA management approved the additional work. Following the external auditors’ need for clarification, we considered this an area of improvement and have since made it a standing order in our practices that whenever our cylinder heads are taken away for further tests, our engineer shall be present,” Mr Osero said.
The audit also uncovered some significant stink in a Sh24.3 million manhole replacement tender.
First, the firm is said to have been handed the contract in unclear circumstances and the amount spent is said to have been inflated, with some items charged four times higher than the prevailing market rates, a scheme that left KPA with a Sh12.5 million bill for an item they would have bought at Sh3.1 million.
No response was given to the auditors for this disparity. KPA said the items had their prices reviewed upwards by a committee constituted to review prices.