Treasury principal secretary Kamau Thugge said the government may purchase some of the vehicles leased by private firms that are in good condition at the end of the lease period.
He said so far the Treasury has leased over 3,000 police vehicles and the first leasing contract involved 1,200 whose four year lease comes to an end in four months.
He said the Treasury has allocated Sh9.4 billion in the current financial year to cater for the lease of vehicles attached to the police, the State Law Office and the Director of Public Prosecutions, among other State departments.
The Treasury is considering buying some of the vehicles leased to the police once the contract agreement comes to an end in four months’ time, signalling a big boost for local car dealers.
Treasury principal secretary Kamau Thugge said the government may purchase some of the vehicles leased by private firms that are in good condition at the end of the lease period.
“We are getting value for money in the lease agreements. Some of these vehicles are in very good condition.
“Once the leasing contract is over, it has to be new vehicles that will be delivered if we renew the lease. But we can buy some that are still in good shape for use by some of the ministries,” Dr Thugge told the Public Accounts Committee (PAC).
He said so far the Treasury has leased over 3,000 police vehicles and the first leasing contract involved 1,200 whose four year lease comes to an end in four months.
He said the Treasury has allocated Sh9.4 billion in the current financial year to cater for the lease of vehicles attached to the police, the State Law Office and the Director of Public Prosecutions, among other State departments.
Dr Thugge told the committee chaired by Ugunja MP Opiyo Wandayi that the Treasury spent Sh7.2 billion to lease vehicles in the last financial year that ended in June.
Under leasing, the State pays a fee to the respective dealers who undertake to provide a certain number of insured and serviced vehicles over several years.
In the current plan, car dealers have committed to service the government vehicles for a period of four years or until they clock 160,000 kilometres, whichever comes first.
The government, in return, pays a monthly, quarterly or annual fee and returns the vehicles to the dealer once the contract expires.
“To see if we achieved our objective of getting better value for money, we hired a consultant to review the whole leasing programme to see whether our objective were met,” he said.
Dr Thugge said the findings of PKF consulting firm that the Treasury hired to look at the value for money aspects in the leasing project found out that the project was cost effective.
“We now know that the pilot leasing project is cost effective and more efficient and it is a concept that can now be spread to the rest of government ministries. The Treasury has no intention to manage leasing for the rest of government,” Dr Thugge said. He said some of the key findings from PKF study show that the programme had led to better fleet management and savings of Sh1 billion realised annually.
“Since we have a study, we will see if we spread it to the rest of government and various ministries. We will see if police will now take up the lease for themselves,” Dr Thugge said.
Dr Thugge said it will take the approval of the cabinet to spread the leasing project to the rest of the government.
The PS appeared before PAC to respond to audit quarries on the expenditure of Sh532 million that was paid by the Treasury for leased police vehicle fuel.
Auditor General Edward Ouko singled out expenditure of Sh17.7 million spent on 18 county headquarters that was not properly accounted for.
PAYE Tax Calculator
Note: The results are not exact but very close to the actual.
