Sh2.3bn digital driving licences plan hits snag
National Bank of Kenya's branch in Nyeri town on April 28, 2016. A controversial tender for digital driving licence project awarded to the National Bank of Kenya has been challenged by a rival company. PHOTO | JOSEPH KANYI | NATION MEDIA GROUP
What you need to know:
- A controversial tender for the project awarded to the National Bank of Kenya has been challenged by a rival company and several other petitioners.
- A ruling by Justice George Odunga now requires National Bank of Kenya to raise Sh1.2 billion from a third party financial institution before the tender can proceed.
- National Transport and Safety Authority had hoped to introduce the e-licences for all Kenyan drivers by mid this year, but the deadline could not be met due to several lawsuits and court processes relating to the tender.
Plans to procure six million digital driving licences valued at Sh2.3 billion by the National Transport and Safety Authority (NTSA) now hang in the balance, following a restrictive court ruling.
A controversial tender for the project awarded to the National Bank of Kenya (NBK) has been challenged by a rival company and several other petitioners.
They argued that the award strayed from the Banking Act, which requires financial institutions to stick to their core area of operation unless permitted by the Central Bank of Kenya.
Although the courts allowed NBK to proceed with the project, a ruling by Justice George Odunga now requires the troubled bank to raise Sh1.2 billion from a third party financial institution before the tender can proceed.
“Having considered the issues raised before me, it is my view that in order to secure the public interest, which all the parties purport to be advancing, the project ought to be permitted to continue but on condition that the bank secures a bond for half the sum of the award from a reputable third party financial institution,” said the judge in his ruling last week.
SEVERAL LAWSUITS
He further ordered: “This is to be done within the next 30 days. In default, the award by the first respondent to the second respondent of Tender No. NTSA/ICB-014/2014-2015 shall stand suspended.”
The authority had hoped to introduce the e-licences for all Kenyan drivers by mid this year, but the deadline could not be met due to several lawsuits and court processes relating to the tender.
The orders issued last week came after the Public Procurement Administrative Review Board ruled in favour of the project awarded to the bank.
The review board tribunal dismissed an application by Symphony Technologies Ltd of Kenya and United Telecoms Ltd of India, which had also submitted bids for the lucrative tender.
The review board chairman, Mr Paul Gicheru, had ruled that NTSA is free to proceed with the procurement of the e-licences through the bank.
NBK, a profit-making entity, shocked the nation early this year when it declared a Sh1.3 billion loss, down from a profit of Sh3.3 billion the previous year.
