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Economy

NYS spends Sh533m on non-existent Karen, Ngong Road markets

Kenya-Somalia
NYS machinery on site at the Kenya-Somalia border. The NYS spent Sh533 million on construction of Karen and Ngong Road furniture markets that only exist on paper. FILE PHOTO | NMG 

The National Youth Service (NYS) spent Sh533 million on construction of Karen and Ngong Road furniture markets that only exist on paper, Auditor-General Edward Ouko has revealed.

Construction of the markets has stalled for two years since the award of the contracts, with the Ngong Road furniture market beset by challenges of a legal claim on the land, leading to a potential loss of Sh533 million that was incurred in procurement of materials.

The audit report says information available on the procurement of construction materials for the Karen and Ngong markets showed that the materials ordered were in excess of the estimated cost of Sh53.5 million for Karen and Sh143 million for the Ngong Road market, which amounted to Sh196.5 million. The balance of Sh336.5 million has not been explained.

“It was not possible to determine how the quantity of materials required was arrived at and if the materials procured and received were of the right quantity and met specifications as per the approved designs and engineer’s estimates,” says Mr Ouko in the report.

The Auditor-General puts the blame on the NYS management.

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“Further, no site handing over minutes have been provided to show that management had conducted due diligence and secured the land before committing public resources and exposing the public to loss of funds.

‘’As a result, it is not possible to confirm that public funds were applied lawfully and in an effective way as required under Article 229(6) of the Constitution of Kenya and that Article 232(1)(b) of the Constitution of Kenya was applied as required under the law.”

Mr Ouko says field inspection carried out in the month of January 2019 showed that materials worth Sh507 million remain unused two years after they were procured and supplied and are lying at the NYS headquarters yard in Ruaraka. The management, he says, did not provide an explanation for the failure to utilise the materials.

“In view of the foregoing, the propriety of the expenditure of Sh532,950,990 on the construction of both Ngong Road and Karen markets could not be ascertained,” he says.

“Based on the total materials cost of Sh532,950,990 and the proposed number of stalls to be constructed of 602, this translates to cost per stall of Sh906,132 excluding labour and supervision costs as compared to estimate all inclusive cost per stall of Sh264,678 and Sh395,887 for Karen and Ngong road markets respectively,” Mr Ouko says in a disclaimer opinion of the books of accounts of the State department of Public Service Commission for the year to June 2018.

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