The department for natural resources awarded a Sh24 million office partitioning tender to little-known Shine Star Contractors Limited without submitting a performance guarantee as required by the law.
The National Assembly's Public Accounts Committee (PAC) heard that the payment was made outside the contract agreement.
"Such kinds of contracts like partitioning of offices require that performance contracts should be availed (sic). But this was an oversight by procurement officers," Environment PS Fred Sergor told the Opiyo Wandayi-chaired committee.
Prof Sergor said the payment was fully made after it was decided that the contractor had completed the works.
"The Auditor-General, however, concluded that the ministry paid Sh16 million for works that were never done."
Prof Sergo said out of the Sh16 million, Sh7 million was spent on extraneous allowances on officers who travelled countrywide.