14 February 2010

Kenya: House Team Spotlights Sh6 Billion Deal

Nairobi — A parliamentary committee has asked Prime Minister Raila Odinga to explain how a company that was not vetted was awarded a tender to solely import subsidised maize.

The chairman of the Agriculture committee, Mr John Mututho, on Sunday said the company, Afrigil Trading Pty Limited, made more than Sh6 billion from taxpayers by inflating the price of maize. According to the PricewaterhouseCoopers audit report, the maize scandal might have cost the taxpayer Sh2 billion.

According to the Naivasha MP, the firm charged $450 (about Sh35,100) for a metric tonne of maize yet the market price at the time was between $150 (Sh11,700) and $300 (Sh23,400) per metric tonne.

Mr Mututho also noted that Afrigil was not among the 123 companies that first tendered, neither was it a part of the five final companies that had qualified to procure the grains.

"Mr Odinga should explain how the company finally ended up being awarded the tender," Mr Mututho asked at a Press conference in Nairobi. "The company was single sourced and it did not feature among those that were selected by both his (Mr Odinga's) committee or the Agriculture committee."

The audit report said that public procurement regulations were disregarded during the award of a tender for the importation of 18,000 metric tonnes of subsidised maize. Mr Mututho said the company was given clearance by an ad hoc committee that was chaired by the PM. "The maize scam was coordinated by the PM's office and he should therefore take political responsibility."

According to the audit report, Prof Gideon Misoi, the then National Cereals and Produce Board managing director, was said to have authorised the irregular award together with Mr Caroli Omondi, an official from the PM's office.

Mr Omondi told the auditors that he was indeed involved in this procurement, adding that the process breaches were deemed necessary in the national interest and for which Cabinet authority was given.

"We have not yet seen evidence to corroborate this view," the auditors concluded. "However, Mr Omondi has clarified to us that in view of the urgency of the matter, he obtained immediate verbal approval from the Cabinet, which was meeting on the apparent day," they added.

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