How Defence ministry risks losing millions over cancelled contracts
By Kipchumba Some | March 13th 2016
The Ministry of Defence risks losing millions of shillings in fines after it arbitrarily cancelled contracts worth nearly one billion shillings it awarded to several architectural and construction companies five years ago.
The firms were approached in May 2010 to provide consultancy services for the design and construction of new quarters for the Kenya Defence Forces (KDF).Since then, they claim, the ministry has kept mum about their dues despite frequent reminders.
According to a letter of Expression of Interest (EOI) sent by MoD to one of the consultants on May 14, 2010, the project was for the construction of new single accommodation units for 10,000 personnel in various military barracks and bases around the country.
“There is urgent need to provide suitable single accommodation in various military barracks in the country for 10,000 personnel. There is, therefore, need to consider all options in the market that are timely and cost effective,” reads the letter by Colonel GRA Owinow to Goro Consultants, one of the aggrieved companies.
“The Ministry of State for Defence has earmarked and wish to invite you, among a few others, to indicate your interest in providing the services,” said Colonel Owinow’s letter.
On March 21, 2011, the company received a commissioning letter from the ministry signed by ZG Ogendi on behalf of the PS.
“Please refer to our coordination of February 15, 2011, held at Defence Headquarters Officers Mess in which your firm was informed that it would undertake consultancy services for the proposed single accommodation in the armed forces-Isiolo/LAB/ Wajir region. In this respect, I have the pleasure in confirming your appointment as the structural/civil engineering consultant for the above project, which is to be commenced this financial year,” reads the commissioning letter. LAB refers Laikipia Air Base.
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It added: “Your services will include the preparation and production of a full development plan, sketch plans, working drawings and complete documentation in conjunction with the entire project consultants as well as post contract suppression as applicable.”
The overall cost of the tender is estimated to have been worth Sh999,582,901.50 and was split among nine teams of consultants. Each team had four specialists—architects, quantity surveyors, civil/structural engineers and mechanical/electrical engineers.
KDF has barracks in Eldoret, Gilgil, Wajir, Isiolo, Nanyuki, Thika, Mombasa, Lamu, Garrisa, Nakuru and Moyale. Other barracks located within Nairobi are in Lang’ata, Kahawa, Kabete, Eastleigh and Embakassi.
Architect Libin Mwacharo of Mwacharo & Associates, the the lead consultant for the whole project, said on Thursday that, in total, there were 36 consultants engaged by the ministry but did not say whether any of them had been paid.
However, MoD spokesman Bogita Ongeri said the ministry does not have any contractual agreement with any of the consultants. “We do not have any contracts with these companies and the ministry never approved any of their designs,” he said.
Mr Ongeri said a commissioning letter “does not amount to a contract; it just allows you (the firms) to visit the site and come up with designs.” A contract, he said, is usually signed by the ministry’s PS and the directors of the companies involved.
Goro Consultants were appointed the structural/civil engineering consultants for the construction of the new units in seven barracks in Wajir, Nanyuki and Isiolo.
These are the Forward Operating Base in Wajir and the Laikipia Air Base in Nanyuki. Others are School of Combat Engineers, School of Artillery, 78 Tank Battalion, School of Infantry (Other Ranks) and School of Infantry (Senior NCO) - all based in Isiolo.
Other consultants in this team were Cadplan Architects, Bunei Maungu & Associates (quantity surveyor) and Veckta Consultants (electrical/ mechanical engineers consultant.)
Eng Evans Goro said he and his team visited the barracks, drew designs and submitted a fee note of Sh40,895,819 to the ministry on May 24, 2011. He has never received a response from the ministry or KDF despite repeatedly calling and writing reminder letters to them.
“No one has ever communicated to us that our contracts were terminated and the reasons for it. I executed my part of the contract but no one is talking about my payment. No one picks my calls at DoD anymore,” said Mr Goro. He has now engaged the services of a lawyer to compel the ministry to pay up.
An official at Bunei Maungu & Associates said they have not been paid for their work but declined to comment further for fear of antagonising ministry officials. He said they were pursuing private talks to resolve the issue amicably.
Another company approached by MoD to participate in the project was Keyplan Consultants, a construction firm owned by Nyandarua Senator Muriuki Karue. The senator said his firm drew the designs for the 5KR in Gilgil and some bases in Nanyuki.
He also declined to say how much he is owed by MoD. “The issue is not how much I am owed, the issue is why we have not been paid five years after we did the work we were given,” said the senator on the phone.
He directed us to Mr Mwacharo for more information, but the architect requested The Standard on Sunday to hold the story until next Wednesday. When his request was declined, Mwacharo threatened to sue this reporter and the Standard Group. He also referred the matter to the Media Council of Kenya.
“Please refer to our telephone and email discussions of yesterday and today (Friday), in connection with an MoD assignment that in our opinion is a private and confidential matter. Our suggestion that you wait until next Wednesday for an update seems to have fallen on deaf ears,” reads an email Mwacharo wrote to this reporter on Friday.
He continued: “Your aim is clearly not to promote public interest, but to poison the relationship between MoD and their consultants, as well as public opinion. If you and your employer go ahead and publishes (sic) the story without MoD or consultants’ engagement, then you and your employer will take full responsibility for any losses or damages the consultants or MoD may suffer.”
Our investigations reveal that the Defence ministry went ahead and built the quarters using its own personnel and those from the Ministry of Public Works without informing the aggrieved companies that it had cancelled their contracts.
The matter brings to the fore once again the issue of opaque tendering in the ministry. Although it nowadays publishes a list of non-core tenders on its website and the mainstream newspapers, the manner in which it procures for its core assets like weapons and uniforms largely remains secret.
These tenders are also subjected to limited scrutiny by the Auditor General.
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