Mr Kimemia wrote to the KAA management warning against termination of the contract, arguing it would cast in bad light the Cabinet, which had already approved the project.
Mr Wambora on the other hand wrote to the KAA’s management advising it to cancel the tender.
The cancellation of the Sh64.7 billion tender led to loss of taxpayers’ cash.
Two governors are set to face queries in Parliament over their roles in the cancellation of the Sh64.7 billion tender for the construction of a new terminal at the Jomo Kenyatta International Airport (JKIA), which led to loss of taxpayers’ cash.
The Public Investments Committee (PIC) wants Nyandarua governor Francis Kimemia and his Embu counterpart, Martin Wambora, to shed light on the circumstances that led to termination of the contract, costing taxpayers Sh4.3 billion which was paid to a Chinese company, M/S ACEG-CATIC JV.
Mr Kimemia was the Head of Public Service and Secretary to the Cabinet while Mr Wambora served as the chairperson of the board of Kenya Airports Authority (KAA) when the contract was terminated.
The tender was cancelled in March 2016 after Sh75 million had been spent on a ground-breaking ceremony that was presided over by President Uhuru Kenyatta on May 23, 2014.
Sh129.9 million was paid to a consultant, Louise Berger, while PriceWaterHouseCoopers got Sh7 million for its role in securing the financier of the project.
Cabinet approval
Mr Kimemia wrote to the KAA management warning against termination of the contract, arguing it would cast in bad light the Cabinet, which had already approved the project.
Mr Wambora on the other hand wrote to the KAA’s management advising it to cancel the tender.
“We will summon Mr Kimemia and Mr Wambora. Mr Kimemia said if KAA cancels the tender it will be in bad taste and disrespect to the Cabinet. This means the Cabinet was aware of the project.
“It is a good thing that they are alive and we have constitutional powers to summon them,” said PIC chairman Abdulswamad Nassir, who also demanded to know why the KAA management awarded the contract to a consortium of two Chinese companies to in 2012.
“Why was the contract terminated despite clear advice from the Attorney General that it should not? “Why would KAA go ahead and sign the contract when the office of the Prime Minister, through a letter by then PS Mohamed Isahakia warned that the government had no budget for the same?” Mr Nassir posed.
Mr Isahakia had also written to the KAA management, alerting it that the Cabinet had not approved the project.
“It appears that KAA originated this project on its own. There was no approval from Cabinet. KAA’s management did the proposal to the board, the board approved and the principal secretary for Transport -- who is supposed to sit in the KAA board -- disowned the project after the award had been issued,” Mr Nassir said.
Untenable
KAA MD Jonny Andersen told MPs the contract was terminated after it became untenable.
“The issue of 16 per cent value added tax (VAT) was among the inconsistencies that resulted in invalidation of the contract,” Mr Andersen said during scrutiny of an audit query raised by Auditor-General Edward Ouko on the tender.
Mr Andersen said KAA is seeking an amicable solution to recover the Sh4.3 billion paid to the Chinese contractor.
“We are in discussion with the contractor with a view to recovering the money that was paid to them on this project. We have been seeking advice from the Attorney General. This is the most complex matter. I have never seen anything like this before,” Mr Andersen said.
The committee questioned how the signed contract excluded the 16 per cent VAT when the request for proposals and the tender documents was specific that quoted prices should be inclusive of all taxes.
The Greenfield terminal was part of the government’s Vision 2030 flagship projects.
Audit findings show that the Chinese contractor was paid before commencing construction.
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