Ouko questions stalled Sh500m project by Labour ministry

What you need to know:

  • In his 2014/15 audit report of the ministry’s accounts, Mr Ouko has also questioned the decision to vary a cost upwards by Sh20 million.

  • The auditor general’s report is currently under consideration by the watchdog committee of the National Assembly the Public Accounts Committee (PAC) - chaired by Ugunja MP Opiyo Wandayi.

  • Mr Ouko has further raised issues on why the completion date was not specified in contract documents, contrary to dictates of the Public Procurement and Disposal Act.

  • Dr Mohammed defended the ministry’s decision to construct the project in phases saying the funds were being disbursed in installments in financial years, an explanation that was faulted by Mr Wandayi.

Auditor General Edward Ouko has questioned the Ministry of Labour and Social Protection about a Sh500 million construction project that has remained stalled nine years later.

In his 2014/15 audit report of the ministry’s accounts, Mr Ouko has also questioned the decision to vary a cost upwards by Sh20 million. The cost in question was for putting up a research complex in the city’s Industrial Area

NO COMPLETION DATE

The auditor general’s report is currently under consideration by the watchdog committee of the National Assembly the Public Accounts Committee (PAC) - chaired by Ugunja MP Opiyo Wandayi.

“The project remains incomplete since the contract was awarded. The builders’ work was divided into five phases with construction being advertised, evaluated and awarded to different contractors per floor,” Mr Ouko said of the stalled project.

An audit inspection undertaken on February 10, 2016 revealed poor workmanship, with fears that it may never be occupied and that the money may have gone down the drain.

Mr Ouko has further raised issues on why the completion date was not specified in contract documents, contrary to dictates of the Public Procurement and Disposal Act.

Principal Secretary (PS) Ibrahim Mohammed was at pains to explain why the project has remained stalled since 2009, when he appeared before the committee..

The ministry has already pumped Sh325 million into the project that is now at phase four with phase five pending.

PHASES

In 2009, the Directorate of the Occupational Safety and Health Services (DOSH) made a proposal for the ministry to construct the complex to help it keep abreast with changing issues in the work environment.

“The implementation of the builders’ work starting with the basement, the ground and first floors being done by one contractor, the second and third floors by another and the upper levels by yet another contractor has led to delay, escalation of advertisement and tender costs,” the audit report says.

Dr Mohammed defended the ministry’s decision to construct the project in phases saying the funds were being disbursed in installments in financial years, an explanation that was faulted by Mr Wandayi.

“This is not proper use of public resources. The explanation given by the PS is not convincing,” Mr Wandayi said.

The PS said the ministry received Sh71.2 million in the 2009/10 financial year to start the project.

“Accordingly, the ministry advertised for building works (phase 1) through an open tender against the available funds which were adjusted and awarded by the ministerial tender committee,” Dr Mohammed told the committee.

“Had the funds been availed at once, the project would have been implemented within 130 weeks,” he said.

Phase one, according to the PS was awarded to Lunao Enterprises at a contract sum of Sh71.2 million while phases two and three went to Makuyo Construction Limited and Blue Stream Enterprises Limited at Sh68.1 million and Sh30.8 million respectively.

Phase four would again go to Blue stream Enterprises Ltd at Sh140.3 million.