MPs wants ex-KPC boss Sang to pay Sh30m loss in botched tender

Parliament wants former Kenya Pipeline Company (KPC) managing director Joe Sang to be held responsible for the loss of Sh30.5 million paid to a contractor for an obsolete electronic budgeting system.

The Public Investments Committee (PIC) has recommended that the Directorate of Criminal Investigations (DCI) and the Ethics and Anti-Corruption Commission (EACC) investigate the whole tendering process and arraign individuals who may have been negligent.

The PIC has recommended that Mr Sang, who was replaced as KPC boss in 2018, be held responsible for the botched deal.

The KPC paid Sh26.5 million (euros 227,338) in advance to a vendor for supply, implement and commission an electronic budgeting system in 2015, which PIC says is obsolete.

The payment represented 51 per cent of the contract sum with the contract’s delivery timeline being months.

The system had not been supplied although 33 months had elapsed since the signing of the contract.

According to the 23rd PIC’s report on the examination of audited financial statements of 48 State corporations, KPC paid the vendor an annual software, maintenance and user training fees totalling Sh4,132,188 despite the system having not been completed or put to use.

KPC has since terminated the contract with the vendor.

Mvita MP Abdulswamad Nassir-chaired PIC said the option of recovering the money by recalling the contract’s performance bond was no longer available to the KPC as the bond expired in November 2015.

When he appeared before PIC to answer audit queries before exiting KPC, Mr Sang said the Sh26,566,082 was not an advance payment but rather based on milestones delivered.