Editorials

Tighten scrutiny of public tenders to foreign firms

President Uhuru Kenyatta

President Uhuru Kenyatta addresses the nation from State House, Nairobi on March 12, 2021.

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Summary

  • The price of inaction is way too costly for the taxpayer.
  • According the US, the corruption in government tendering, which favours unscrupulous companies who do shoddy work, has contributed immensely to stalled projects.
  • It has also locked out qualified American firms from undertaking projects in Kenya, slowing down trade and investment ties between the two countries.

That the US has raised concerns over corruption in government tendering in Kenya won’t surprise anyone. But it should at least remind the relevant authorities about the need for tighter procurement scrutiny in all ministries.

The price of inaction is way too costly for the taxpayer. According the US, the corruption in government tendering, which favours unscrupulous companies who do shoddy work, has contributed immensely to stalled projects. It has also locked out qualified American firms from undertaking projects in Kenya, slowing down trade and investment ties between the two countries.

The US Trade Representative’s office (USTR) says rogue public officials manipulate tender bids to suit their interests and those of their cronies. This denies opportunities for foreign investors who do not offer bribes to wheeler dealers. The rigged procurement benefits foreign firms without proven track records, which are given the government contracts especially when they have partnerships with well-connected Kenyan firms.

Investors paying bribes tend to recover their money by inflating prices, billing for work not done, failing to meet contract standards, or using inferior materials. This has led to loss of public funds through misallocations or higher expenses and lower quality of goods and services.

Many of these tenders are challenged in the courts, another expense that eats into public funds. This has to stop.

Transparency is key if President Uhuru Kenyatta’s government is to woo credible investors. This will save Kenya money because project bills will not be inflated.

The State must tighten scrutiny of public tenders, especially in the construction, transport, and ICT sectors, which the Organisation for Economic Co-operation and Development has flagged as having the highest foreign bribery cases.

Revising the public procurement law to have the Attorney-General sign off all public tenders valued at a minimum Sh500 million, down from Sh5 billion currently, may tighten oversight. But taxpayers and potential investors can only feel confident if such laws are implemented to the letter.