Blow for Uhuru as firm picked to supply laptops is rejected

A teacher helps learners on their laptops. President Uhuru Kenyatta’s pet project-the schools laptop scheme-suffered a major setback when the procurement authority rejected the Indian company that had been awarded the Sh24 billion tender. PHOTO/FILE

What you need to know:

  • It is the latest setback in a project which formed one of the pillars of President Kenyatta and Deputy President William Ruto’s 2013 campaigns. The two distinguished themselves as “digital” as opposed to the Raila Odinga- and Kalonzo Musyoka-led Cord ticket which they described as “analogue”.
  • And just when the deal appeared to be finally on course, the Sh24.6 billion tender which had been awarded to an Indian company was on Tuesday cancelled following a successful appeal by two bidders who lost.
  • The Public Procurement Administrative Review Board found that the Ministry of Education had awarded the tender at Sh1.4 billion more than the price quoted by the winning bidder before negotiations with the ministry.

President Uhuru Kenyatta’s pet project — the schools laptop scheme — suffered a major setback when the procurement authority rejected the Indian company that had been awarded the Sh24 billion tender.

The government was instead given 45 days within which to re-evaluate bids by computer firms HPU of the Netherlands and Haier of China and award a new supply tender.

It is the latest setback in a project which formed one of the pillars of President Kenyatta and Deputy President William Ruto’s 2013 campaigns. The two distinguished themselves as “digital” as opposed to the Raila Odinga- and Kalonzo Musyoka-led Cord ticket which they described as “analogue”.

The Jubilee leaders promised to give the laptop computers to Standard One pupils in the first term but the deadline passed as wrangles over tendering raged.

The Kenya National Union of Teachers at one time demanded that the Sh26 million budgeted for the laptops be reassigned to pay teachers salaries.

And just when the deal appeared to be finally on course, the Sh24.6 billion tender which had been awarded to an Indian company was on Tuesday cancelled following a successful appeal by two bidders who lost.

The Public Procurement Administrative Review Board found that the Ministry of Education had awarded the tender at Sh1.4 billion more than the price quoted by the winning bidder before negotiations with the ministry.

The ministry had awarded the tender to Olive Telecommunications PVT at a price of Sh24.6 billion. But it emerged that on December 13, 2013, when applicants submitted their best and final offer that the offered price was about Sh22.5 billion.

BEST OFFER

And the board chaired by Ms Josephine Mong’are ordered the tender reviewed from the stage of Best and Final Offer (BAFO) with two of the companies that appealed the award — Hewlett Packard Europe and Haier Electrical Appliances — being the only participants.

HP had quoted Sh24 billion and Haier Sh25 billion. The two firms had in their appeal also claimed that their value additions were not given considerations by the evaluation teams thus disadvantaging them.

“The award of tender NO: ICB/MOEST/7/2013-2014 for the supply,  delivery, installation and commissioning of the ICT integration in devices and solutions for primary schools in Kenya Lot 1 to the interested party awarded it Tender no M/Ms Olive Telecommunications PVT is hereby annulled,” the board ordered.

The fresh process must, according to the order by the board, be conducted within 45 days and due diligence conducted as per specifications in the tender document.

Yesterday, the board also said that the Indian company did not meet the mandatory financial requirement set in the tender document and did not prove that it was an Original Equipment Manufacturer as envisaged.

The board said that both Olive and the Ministry of Education only offered “generalities” for answers pertaining to the financial ability of the winning firm and that no affidavits were provided to prove the qualification of the winning bidder.

“The winning bidder was required to have an annual turnover of about Sh8 billion but the board discovered that the annual turnover as per the audited books of account showed that the interested party  (Olive) only had Sh1.1 billion which did not meet the financial condition set by the procuring entity,” the board said.

It further ruled that in view of financial capacity alone, the ministry should not have allowed Olive to go past the preliminary stage of the tendering process.

Other flaws including failure to provide documentary evidence that Olive had a business relationship with Olive Global Holding Private Limited, Olive Telecommunications (Hong Kong) and new Century Optronics Company Limited.

JOINT BID

Olive had indicated that it had placed a joint bid with a Chinese firm Century Optronics Company Limited.

An agreement or a memorandum of understanding between companies placing a joint bid or bidding  as consortium is a mandatory requirement during the preliminary stages and at the evaluation stages.

“The tender application was solely submitted in the name of  Olive Telecommunications PVT .The letter of notification of the award was written to Olive Telecommunications PVT. Both the procuring entity and the interested party did not supply documents or affidavits to prove joint bids with the mentioned companies,” Ms Mongare stated.

The board also ruled after reviewing various dictionary definitions of the term Original Equipment Manufacturer (OEM) that the Indian firm was not one.

Interestingly a Due Diligence report by a team of experts send to India and China by the ministry of Education confirmed proof of financial stutus and technical ability ater touring the firms offices and factories owned by Centruty Optronics Company.