The site of the proposed Kimwarer multipurpose dam at Talal in Elgeyo Marakwet County. PHOTO | FILE | NATION MEDIA GROUP
- By January, a total of Sh19.7 billion had already been processed as advance payment for the Kimwarer and Arror dam projects, four years down the line, there is no evidence that land had been acquired for the projects.
More by this Author
According to the Director of Public Prosecutions (DPP) Noordin Haji, by January, a total of Sh19.7 billion had already been processed as advance payment for the Kimwarer and Arror dam projects, four years down the line, there is no evidence that land had been acquired for the projects.
The funds paid are about 30 percent of the estimated project costs.
DPP Haji said it was “a well-choreographer scheme by government officers in collusion with private individuals and institutions.”
Here, in a simple explainer, we show how the billions of shillings were unjustifiably and illegally paid out.
- The National Environment Management Authority (Nema) approved an Environmental Impact Assessment (EIA) which gave the nod for the projects yet there is no evidence that it was ever carried out. The environmental agency also ignored protests from other state agencies not to approve the projects.
2. NATIONAL TREASURY
- Sh643 million was released by the National Treasury for the compensation and resettlement of people who would be affected by the said projects, yet there is no evidence that land has been acquired.
3. KENYA FOREST SERVICE
- Officials insisted on going on with the projects despite opposition by the Kenya Forest Service on an excision of forest land to build the dams.
- So as to circumvent the process to ensure that Italian firm CMC di Ravenna got the contract, the Kerio Valley Development Authority (KVDA) used the Public Procurement and Disposal Act of 2005 for the concession despite the fact that the law in 2013 prescribed Public-Private Partnerships (PPP).
5. CMC DI RAVENNA
- Officials went ahead to award the contracts to CMC di Ravenna despite being aware that the firm was getting into voluntary liquidation back in Italy.
6. MEGA PROJECTS
- CMC di Ravenna was awarded the contract despite being awarded three other mega projects that were either incomplete or yet to commence.
- KVDA officials refused to allow competition among suppliers for the contracts.
- Whereas the commercial contracts states that the contracts would cost Sh46 billion, the National Treasury negotiated a loan increasing the amount to Sh63 billion. This was an increase of about Sh17 billion.
- CMC di Ravenna submitted draft technical designs in February 2019, four years behind schedule.
- The National Treasury entered into a facility contract in Euros while the commercial contracts were in US dollars, thus occasioning further loss through exchange rates.
- Sh11 billion for insurance was paid upfront yet a government guarantee would have sufficed at no cost to taxpayers.
12. INTEREST LOAN
- Sh4.6 billion was borrowed in addition to the principle amount to pay interest in advance during the construction period, which to date has not commenced. This means that the government borrowed a loan and later on borrowed another loan to pay the interest of the first loan.
- Treasury officials went ahead to borrow a loan amounting to Sh61 billion for the construction of the dams, despite being advised of the high debt stock.
14. INDIVIDUAL BANK ACCOUNTS
- The borrowed funds did not pass through the Consolidated Fund accounts but went direct to individual bank accounts in effect guaranteeing that no one was oversighting its use.
15. NO WORK
- Sh19,714,366,991 has so far been paid by January 2019 as advance payment, commitment fee, insurance and other costs, yet no work has started so far.