Bungled tender delays plan to roll out new-look bank notes - Daily Nation

Bungled tender delays plan to roll out new-look bank notes

Sunday April 15 2018

The Central Bank of Kenya which floated the tender for the award of the new currencies in line with the consitution. FILE PHOTO | NMG

The Central Bank of Kenya which floated the tender for the award of the new currencies in line with the consitution. FILE PHOTO | NMG 

By BRIAN NGUGI
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Last week’s High Court ruling and subsequent appeal of a Sh10 billion money printing tender to a British firm once again pushed back the country’s switch to a new-look currency.

Kenyans, therefore, have to wait much longer to have new notes in their wallets and purses.

British currency printer De La Rue International has turned Kenya’s long-standing plan to roll out the constitution compliant new generation bank notes on its head.

CBK represented by lawyer Ochieng Oduol, and which has since appealed the latest High Court decision now faces a rocky path in fast-tracking the complex roll-out of the longstanding new look currency in line with the constitution.

The replacement of the old currency notes will cost Sh18 billion, according to CBK estimates.

De La Rue has had a stranglehold on Kenya’s lucrative money printing business except for the period between 1966 and 1985 when another UK firm Bradbury Wilkinson did the job.

The new-look currency is expected to be in notes of 50, 100, 200, 500 and 1,000 shillings.

Their introduction will be accompanied by a massive public campaign to sensitise the public.

This will be followed by the subsequent withdrawal of the current currency in phases.

The tender has, however, been seen as an acid test for the banking regulator, which has never successfully floated a competitive international currency printing bid since it was established in 1966.

And now the Central Bank of Kenya risks legal action for the delay in rolling out the currency as required by law.

Article 231(4) of the constitution outlaws currency bearing portraits and images of individuals yet notes and coins with such features remain in circulation meaning they are in violation of this clause.

The Cabinet gave the CBK the go-ahead to develop and begin rolling out the new notes in February 2015. CBK Governor Patrick Njoroge had in March 2016 told the Senate that the bank missed the planned August 2015 deadline following cancellation of the tender on March 24.

This was after bidders quoted zero price. The CBK, in consultation with the Attorney-General, ruled the move illegal.

And on Monday, the High Court nullified the bidding process that awarded De La Rue International the mega contract late last year on the basis of a 15