Scandal of theft and kickbacks at UN

In the transport contracts, the auditors found that one company had been awarded three contracts worth US$1,431,052 (Sh107million) for regular and unscheduled shuttle services.

In another contract, Sh200 million was paid for general services staff to and from work but there was no evidence that there had been regular monitoring of contractual conditions.

“On the basis of the documentation provided OIOS concluded that the Procurement, Travel and Shipping Section (PTSS) and requisitioners had not correctly followed procurement and contract management procedures and was unable to satisfy itself that the UN obtained best value from the contracts,” the auditor states.

On furniture, no standard contract format was followed-the legal obligations were based on exchange of documents between parties rather than a formal contract.

The auditors could also not establish the basis on which the companies were selected because of lack of consistent criteria. The PTSS failed to estimate the total value of furniture purchases and monitor it over time. “The value eventually exceeded US$500,000 (Sh37.5million)”, the auditors reveal.

In an abuse of the procurement procedures, UNON purchased executive office furniture for US$4100 (Sh308, 000) although it had negotiated a similar package for US$1228 (Sh92, 000).

This is more than three times the negotiated amount.

The auditors passed the same verdict when they reviewed the Information and Communication Technology (ICT) service contracts worth US$2 million (Sh150 million).

In the case of hardware and software maintenance contract worth US$1.3 million (Sh97.5 million), the work carried out did not fully match the terms of reference and the documentation available did not provide a satisfactory basis for the award of the contract, the auditors state.

Lack of request

Further, it was established that the part of the contract on preventive maintenance had not been fully carried out in accordance with the contract terms. “The limited number of bidders and the lack of request for expression of interest also raised doubts as to whether best value for money was obtained”, the report reveals.

In two contracts for network maintenance services worth US$250,633 (sh19 million), the terms of reference used for the original bidding exercise did not reflect the actual work to be carried out under the contract.

“The basis on which the payments were made and performance evaluated was therefore unclear”, the auditor concludes.

In the case of the systems contract for the provision of computers worth US$606,419 (Sh45million), the company had been holding the contract with UNON since 1998 after bidding exercises in 1998, 2000, 2002 and 2005 and contract extensions in between while awaiting a new request for proposal.

The auditors note that no evidence was provided to show competitive analysis for this contract or to explain the basis for their extension.