The Auditor-General has called out Kenya Power for Sh29.6 billion worth of spending which involved failure to produce evidence of payments to contractors besides purchase of faulty equipment under the Last Mile Connectivity Project.
The lack of financial accountability is among a series of governance lapses bedevilling the project that aims to connect homes to the national grid at a subsidised cost.
The initiative is funded by the Kenyan government and the African Development Bank (AfDB).
“The project had received a total of Sh28.2 billion representing 63 percent of the approved loan amount of Sh44.7 billion. However, documents in respect of disbursement and payments to contractors were not provided for audit verification,” the audit report says.
“In addition, although the project had a projection of connecting 525,796 customers by the end of the project, only 213,432 had been connected representing 41 percent of the projection yet disbursement was at 63 percent.”
The report also found that single prepaid meters purchased from a Chinese company at a cost of Sh1 billion and installed at customers’ premises were not vending.
This was despite the fact that the gadgets had been activated by the contractor, “implying that customers were purchasing tokens but the Consumer Interface Units (CIU) were not picking the tokens and thus had no access to power.”
Other meters had taken as long as three years without working. Kenya Power was also put under the spotlight for spending Sh274.3 million on consultants whose work could not be ascertained.
The consultancy services were for supervision and management of civil works and installation of meters.
“However, site visits by the audit team revealed no evidence of consultants’ personnel’s presence at those sites, raising doubt on whether they had been deployed as per the contract,” the report says.
The Auditor-General also stated other instances where the project was implemented without regard for regulatory and procurement processes.
The were was no evidence of engagement with Energy and Petroleum Regulatory Authority (EPRA) and Rural Electrification and Renewable Energy Corporation (REREC), an omission the auditor said can lead to duplication of projects.
“Documents that are key to procurement of services and works including feasibility studies and surveys, progress reports for projects, technical specifications, bills of quantities and architectural drawings, and environmental and social impacts assessment reports were not provided for audit review,” the report says.