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How Jubilee government plans to crash public tender cartels

KENYA
By Alphonce Shiundu | June 13th 2015
Speaker Justine Muturi during budget reading at Parliament on Thursday. [PHOTO: TABITHA OTWORI/STANTDARD]

Jubilee administration has embarked on a policy and legislative drive to lock brokers, cartels and wheeler-dealers out of big-money government contracts.

President Uhuru Kenyatta, Speaker Justin Muturi and Cabinet Secretary for the National Treasury Henry Rotich have rolled out the three-pronged attack to crush the well-connected powerful cartels that thrive on bribes and kickbacks to win government tenders.

On the day that President Kenyatta sent a memo to MPs with a directive for the National Assembly to tighten the new procurement laws to make sure brokers and cartels that target big-money government contracts are not allowed to steal public funds, the Treasury CS and the Speaker all proposed tough measures that if implemented will forever change the procurement terrain in government.

The five-page memo to Speaker Muturi binds MPs to approve the provision that all brokers and procurement agents to government deals are registered and licensed. The idea is to make sure the agents strike deals that benefit the procuring government entity.

"This clause seeks to regulate the behaviour of agents in procurement and asset disposal procedures and safeguard public resources," the President noted in the changes that have to be included in the Public Procurement and Asset Disposal Bill, 2015.

MPs will have to raise a two-thirds majority (233 MPs) to overturn the drastic proposal.

For the first time in a long time, Mr Rotich becomes the first head of the public purse to try and force the government to buy goods and hire services at market rates. He says the law is to "entrench efficiency in expenditure and ensure effective service delivery".

"We can achieve a lot more with the resources we generate if only every ministry and departmental agency applies budgetary allocations prudently," Rotich said.

To do so, he said, the e-procurement module that the President has stressed on, has now been rolled out. It has a price guide so that if any official tries to procure goods and services at an inflated cost, then, the system will send out an alarm.

"Value for money is the ultimate goal, Rotich said in his Thursday address to MPs.

Still suffering from the procurement-related scandals and litigation that rocked two of the flagship projects – the Standard One laptop deal (Sh17 billion), and the Standard Gauge Railway (Sh447 billion); the Jubilee bosses at State House, Parliament and Treasury now insist that henceforth they will compare the cost of any multi-billion shilling deal with what is offered in the market, before putting pen to paper.

"Only projects that have been appraised and found to be viable and whose cost is within reasonable margins of similar projects in the private sector shall commence implementation," said Rotich.

Muturi says the national government's funds were exposed, to an extent that every year, the country loses between Sh300 billion and Sh400 billion to brokers and cartels that target the procurement process to make quick money.

"We have been getting the report of the Auditor General year in year out. For the longest time, that report has been consistent that there's one place where we have had so much loss: it has been in the area of procurement. Can we think of ways of trying to minimise this," said Speaker in a meeting with journalists on Thursday night.

Muturi's proposal is to have one huge entity to handle all purchases for the government. "Can we have a single buyer for the national government? So that in a way, everybody takes their procurement plans to that central place so that you minimise those people who want to negotiate and cut deals," said Muturi.

Anyone who needs anything, Muturi said, will have to send specifications to that entity and then "wait".

If the powerful triad at State House, Parliament and at the Treasury agree, then life will be difficult for the brokers.

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