Govt must pay Safaricom Sh10bn after default on security deal

The National Treasury is under pressure to pay mobile telephone service provider Safaricom more than Sh10 billion after the government defaulted on a contract for national security surveillance equipment.

Appearing before the National Assembly’s Administration and National Security Committee to “justify” budgetary proposals in the Supplementary Budget for the security department on Thursday, Interior Cabinet Secretary Joseph ole Nkaissery said Safaricom had threatened to impose heavy interest.

“The government defaulted on the agreement with Safaricom in which it was to offer some frequencies to the firm and have the cost of the contract reduce by Sh6 billion,” said Mr Nkaissery. “The government did not honour the agreement and now we have to pay Safaricom the full amount.”

The matter could, however, be sorted out amicably. Treasury Principal Secretary Kamau Thugge told the Finance Committee at a separate meeting that the debt would be cancelled out as Safaricom paid the government a similar amount in dividends. 

Mr Nkaissery said the Sh18 billion project, which saw over 1,800 security cameras installed in Nairobi and Mombasa in a bid to fight crime, was complete and was awaiting commissioning.

He said the cameras installed strategically in the city and at key installations such as the Mombasa port and Jomo Kenyatta International Airport were integral in fighting crime, adding that they had resulted in the recovery of 750 stolen vehicles, among other achievements that were “sensitive in nature”.

The cameras will be installed in the major towns of Kisumu, Eldoret and Nakuru once funds are available, he told the committee chaired by Tiaty MP Asman Kamama.

Kitui Central MP Makali Mulu questioned the inclusion of the “development vote” in the Supplementary Budget instead of the main Budget, or the annual budgetary estimates, and accused the ministry of poor practices.

GRACE PERIOD

However, Mr Nkaissery, who was accompanied by Inspector-General of Police Joseph Boinnet, said the request was not contained in the 2016-2017 Budget because the project, started in 2014, had a 24-month grace period that lapsed last year to test the reliability of the project before funds could be released to Safaricom.

The project was one of four budgetary items requested by the ministry in which justification was sought before the committee approves and recommends them to Parliament.

MPs also queried why Sh370 million had been deducted from the Sh940 million allocated for the completion of the police forensic laboratory, which has been going on for the past 15 years.

“We have to complete this project, which is long overdue, because we cannot keep on relying on others such as the Federal Bureau of Investigation (FBI), like it happened during the Westgate attack,” said Mr Kamama.

Nyandarua Woman Representative Wanjiku Muhia proposed a technical team composed of committee members and ministry officials to come up with the budgetary requirements and lobby the Treasury to set aside the funds.

***

KDF, NIS given Somali border wall funds

Mr Nkaissery said part of the Sh3.3 billion for building a fence along the Kenya-Somalia border as a security measure against Al-Shabaab terrorists had been transferred to the Kenya Defence Forces (Sh2 billion) and the National Intelligence Service (Sh1.3 billion).

He said the KDF had the technical capacity and manpower to build the fence while the NIS already had officers working along the border.