The decision by government to cancel all pending tenders by the National Social Security Fund and subject those that have already been awarded to audit has cast a shadow of doubt on several mega projects earmarked by the Sh126 billion retirement scheme and exposed it to court battles.
Some of the projects expected to be affected by Labour secretary Kazungu Kambi’s declaration on Tuesday include the Sh6.7 billion extension of Hazina Towers to 39 floors, construction of 100 apartments along State House Road dubbed Milimani Apartments and the Sh80 billion Mavoko City, a project approved by the Cabinet last week.
“Following the recent sacking of Tom Odongo as managing trustee of NSSF, the government has cancelled all projects that were tendered but not yet awarded or started. The projects will be tendered afresh. Further, that all projects awarded and on-going will be subjected to a comprehensive audit by Efficiency Monitoring Unit,” said Mr Kambi in a statement.
NSSF paid out Sh810 million last year to two contractors who had sued it for breach of contract, in out of court settlements.
The cancellation and suspension of the tenders comes 10 days after the Labour secretary fired Mr Odongo and a board member, Fred Rabongo. Mr Odongo was dismissed without any public explanation.
Also in doubt is a tender on provision of medical insurance which was supposed to take effect Thursday. The insurance contract was for a period of two years.
Extension works on Hazina Trade Centre was commissioned early last month by Mr Kazungu, having been awarded to China Jiangxi.
The contract had initially been awarded to Kenyan firm, Cementer Limited for Sh6 billion, but two losers in the bidding process, China Wu Yi and China Jiangxi challenged the decision in court which ruled in their favour.
Cementer did not participate in the second bidding advertised after the court decision. Construction of the building, set to be the tallest in the region on completion, has been dogged by controversy for nearly a decade.
Mr Odongo was appointed managing trustee of the Statutory retirement Fund in November last year after he had sat in an acting capacity for 10 months.
He has gone to court challenging his dismissal, stating that the government owes him an explanation for its actions and that the Cabinet secretary did not follow due process in terminating his services.
The case comes up for hearing in the Industrial Court Thursday morning. Hope Mwashumbe is the acting chief executive.
The fund is currently lobbying members of parliament to support a Bill which seeks to convert it from a provident fund to a pension scheme, while increasing mandatory contributions of all members.
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