MPs want Kimunya, Ndung’u out over currency printing deal

Transport minister Amos Kimunya and Central Bank of Kenya Governor Njuguna Ndung’u were on Tuesday hit by a fresh storm after a parliamentary committee recommended that they be investigated and charged over loss of public funds.

Through a report tabled in the House by its chairman Bonny Khalwale, Parliament’s Public Accounts Committee said the two public officers should be held responsible for the loss of Sh1.8 billion through a controversial currency printing contract with UK security printer De La Rue.

The committee wants the duo to be investigated by the Ethics and Anti-Corruption Commission (EAPCC) ‘with a view to taking
appropriate legal action and recovering lost funds.’

This is the second time that Mr Kimunya and Prof Ndung’u are in trouble with Parliament over a transaction involving public assets.

The duo narrowly survived Parliament’s onslaught over the controversial sale of Nairobi’s Grand Regency Hotel to a Libyan investment fund.

Parliament forced Mr Kimunya out of the Cabinet through a vote, but he was later reinstated in a different portfolio.

The report has hit Prof Ndung’u exceptionally hard – recommending that his contract be immediately terminated and the President sets up a tribunal to investigate his conduct as provided in the CBK Act.

“In the meantime, Prof Ndung’u must step aside from office with immediate effect,” said the committee.

Meanwhile, the committee, subject to a review of the contract agreements, has backed the Cabinet’s decision that allowed the government to form a joint venture with De La Rue for a 40 per cent stake in the security printing firm at an estimated Sh655 million.

Mr Kimunya, then Finance minister, invoked a Cabinet decision to have the CBK cancel a money printing contract with De La Rue, the UK currency and security printer, as Kenya headed into a general election in November 2007.

The minister had argued that his directive was informed by the fact that the government intended to enter into a joint venture with the company.

De La Rue was to print 1.7 million pieces of currency notes in Malta, but cancellation of the contract occasioned the government a Sh1.830,909, 616 loss, according to the committee’s findings.

Mr Kimunya argued that printing a large number of currency notes in an election year posed a security risk besides the fact the country lacked the means of transporting and storing such a large amount of money.

That move forced the government to continue relying on short term orders that saw De La Rue continue to print currency at its Ruaraka plant at a higher cost.

The UK firm had in 2006 won a 10-year contract to print 1.71 billion bank notes at a cost of Sh3.6 billion ($51.2 million). The new notes were to come with enhanced security features.