Contractors stall Sh9bn roads after payment

Rogue contractors are on the spot for the loss of taxpayers’ billions after abandoning road works and delays in completing projects worth Sh9 billion despite receiving payments, the Auditor-General reveals.

The report of Auditor-General Edward Ouko on the accounts of Kenya Rural Roads Authority (KeRRA) as at June 30, 2017, has detailed how contractors have failed to offer taxpayers value for money.

The scheme involves transferring works to unqualified firms after receiving payment, abandoning projects midway and shoddy works that have forced the State to seek other contractors at extra costs.

The questionable works are in rural Kenya and the contracts are worth Sh9.08 billion. A case in point is the construction of Kaptama- Sirisia Road in Bungoma, which according to Mr Ouko, Sh2.6 billion has already been paid but there is nothing to show for it.

“In the circumstances, it has not been possible to confirm whether the public obtained value for money already incurred,” Mr Ouko said of the contract that was later be terminated.

The 64 kilometre road project was awarded to KSL International Limited in 2007 with the works expected to start in June of the same year and end by May 2010.

However, 11 years down the line, the project is yet to be completed with Mr Ouko saying that the management has not availed information on its current status.

To compound an already sorry situation, the contractor, according to Mr Ouko, was put under receivership in 2015 with all the site operations brought to a halt.

The contractor was also unable to settle Sh3 million in rent arrears owed to the authority for the Mwatunge camp in Taita Taveta, which was used in the previous contract.

The contractor later filed for mutual winding up of the contract in 2015 on account that the balance of funds to the contract sum was insufficient to complete the outstanding works based on design specifications. The rehabilitation and repair of Sh818.5 million Kasoiyo- Saos- Society Road is also facing completion challenges. It was awarded to M/s Bridgestone Construction Company Limited and was set to be completed by February 2016, but it is still pending to date.

“Although the contractor requested for substantial completion inspection in September 2017, the management had not undertaken the same by the time of the audit,” Mr Ouko says.

According to the report, works valued at Sh504.8 million were assigned to another contractor, Guangxi Hydroelectric Construction Bureau, an indication that the main contractor’s performance was poor.

The Sh2.1 billion construction of Murang’a- Gitugi and Njumbi- Mioro Road is also facing issues with Mr Ouko reporting “unsatisfactory” matters. The project was awarded to M/s Nyoro Company Limited in July 2012 with the completion date supposed to be in February 2015.

By June 30, 2017, the project was 47 per cent complete against an elapsed contract period of five years, an indication that it is far behind schedule and could lead to escalation of costs.

There is also the Sh7 million interest, which has been incurred as a result delayed payments.

The other projects which are facing challenges include the Sh2.5 billion- the construction into bitumen standards of the 45.9 kilometer Naromoru- Munyu- Karisheni road.

It was awarded to M/s Kirinyaga construction limited in 2012 with completion expected in 2014.

The completion date of the Sh2.6 billion- rehabilitation and repair of Eldoret- Ziwa- Kachibora- Eldoret- Kabenes road is also not with Mr Ouko saying that it is behind schedule despite starting in 2011.

The road was to be completed in March 2014 but was revised by two years.