The National Youth Service (NYS) is on the spot again after it emerged that taxpayers may have lost about Sh54 million in a questionable food delivery contract.
The Public Accounts Committee (PAC) of the National Assembly heard on Thursday that the NYS awarded the contract to a company that had not been registered.
According to Auditor-General Edward Ouko's report for financial year 2016/17, Annuar Investments was hurriedly registered after the money was paid, in a suspected cover-up.
The company contracted to supply food and rations to the service signed the contract on August 20, 2014 but according to records, it was registered on June 16, 2015, six months after it won the tender.
Youths Principal Secretary Francis Owino, while appearing before the PAC, defended the ministry, saying the department did not have contractors at that time and relied fully on suppliers recommended by the Lands ministry.
“The State Department did not have contractors at the time. This necessitated the adoption of contractors from the Ministry of Lands in line with Public Procurement and Disposal of Assets Act, 2005,” Mr Owino told the committee.
The committee, led by chairperson Opiyo Wandayi (Ugunja) and members Otiende Amolo (Rarieda), Peter Masara (Suna West) and Kimani Kuria (Molo), faulted the ministry and accused it of sleeping on the job by blindly approving a non-existent company, thereby occasioning a huge loss of public funds.
Mr Wandayi said, “Even if you did not have contractors, are you telling us you entered into a contract and in the process of doing so did not care to check the legal status of the company?”
He added, “[Someone can provide a contractor] but you must get the details of the contractor. Your department must at least know who it is dealing with,” Mr Masara said.
Mr Owino admitted that the department overlooked the matter and informed the committee that the ministry had already launched investigations on the company.
“It was assumed that due diligence had been done by the contracted department,” he said.
Mr Wandayi directed that the ministry furnish the committee with all contractual documents.