Economy

MPs suspend Sh14bn Galana irrigation plan

Parliament’s Agriculture committee has suspended the Sh14 billion Galana-Kulalu irrigation plan awarded to an Israeli company to develop a model farm, making it the latest of President Uhuru Kenyatta’s flagship projects to run into strong procurement headwinds.

Committee chairman Mohammed Noor, who was accompanied by 10 other members, said the award of the contract was shrouded in mystery and not subjected to competitive bidding.

The committee has put the tender on ice because Israeli firm Green Arava was awarded the contract without bidding, adding that the company is a subsidiary of Agro Green — which was appointed to conduct a consultancy for the development of the one million acres of land under irrigation.

READ: Israeli firm wins contract for model Galana irrigated farm

The MPs resolved to suspend the contract until relevant documents, due diligence reports and proof that procurement laws were followed are made available.

“The initial consultancy was competitively awarded to Agro Green at a total cost of Sh920 million. However we have just learnt that the 10,000 acres of model farm has been awarded the same way that the Sh327 billion standard gauge railway was awarded. The consultancy is now the contractor and the executor of the 10,000-acre model farm projects,” Mr Noor said.

The railways contract did not have public bidding, which Kenyan officials said was a condition of Chinese loans to help to fund construction, and some legislators complained that the project was also overpriced.

READ: Kenya, China sign Standard Gauge Rail deal

Mr Noor told a news conference convened Wednesday evening at Parliament Buildings that the Sh14.2 billion contracts had been awarded to Agro Green was in breach of procurement law.

“We are now clearly stating that the contract is null and void until due diligence and procurement laws are followed,” the committee said.

The irrigation project joins the growing list of public mega schemes that have been rocked by tendering disputes, including the Sh170 billion coal-fired power plant in Lamu, schools laptop tender (Sh24 billion) and Mombasa-Nairobi new pipeline (Sh43 billion).

Green Avra was to spend Sh14 billion on a 10,000-acre piece of land to be used as a model on how to develop the one million acres set for irrigation.

The project, which is estimated to cost Sh260 billion, will start next year and is expected to cut Kenya’s reliance on rain-fed agriculture that is blamed for the perennial food shortage. 

The MPs said they would summon Agriculture secretary Felix Koskei to shed light on the award of the tender.