Gov't pays local media firm Sh290 million for Sh12 million contract - Auditor General Report

June 30, 2021 10:17 AM

The government owes the firm an additional Sh62 million.

A video camera

The National Assembly Public Accounts Committee (PAC) has flagged the payment of Sh290 million in accrued interest to a private media company by the government.

According to an Auditor General’s report recently tabled before the committee led by Ugunja MP Opiyo Wandayi, the government still owes the Tele-News Africa and Atlantic Region Sh62 million shillings.

The irregular payment was flagged because the contract was initially worth Sh12 million for services such as advertising and promotion of business opportunities in Kenya on behalf of the government.

New Auditor General Nancy Gathungu as she took the oath of office on July 17, 2020 New Auditor General Nancy Gathungu as she took the oath of office on July 17, 2020 Pulse Live Kenya

Auditor General Nancy Gathungu said in her report for the 2018/19 financial year, the contract ended in June 2004.

“Does it prick your mind to continue subjecting public funds to such payments? Wandayi asked as Tourism Principal Secretary Safina Kwekwe struggled to explain.

“It disturbs us because it means that further delay in settling the pending bill means an enhanced cost on the taxpayer.

War on corruption

Kenya’s war on corruption is set to receive a major boost with the intervention of the International Monetary Fund.

The approval of a Sh256 billion loan in 2021 came with tough conditions for the government to abide by such as taming graft.

The international lender has called for the publicising of beneficial owners of all companies awarded government contracts.

The bank also requires Kenya to cut down on expenditure and restructure state-owned corporations back into profit making territory.

IMF approve's Ksh78.3b loan for Kenya IMF approve's Ksh78.3b loan for Kenya Pulse Live Kenya

Parastatals lined up for restructuring are Kenya Power, Kenya Ports Authority, Kenya Pipeline, Kenya Broadcasting Corporation (KBC), KenGen and public universities.

If Kenya fails to achieve this or any other requirement, the deal will be terminated.

A fall out with the IMF will see Kenya lose favor with international investors, including those who recently purchased its Eurobond.