REVEAL SECRET ‘TENDERPRENEURS’, …fund gives Kenya up IMF DEMANDS until March 2022
NAIROBI - The government must reveal the names of secret owners of all companies that win State tenders as part of a programme it has with the International Monetary Fund (IMF).
This will begin in April 2022 as part of the 38-month programme that is aimed at helping Kenya improve its finances by reducing wastage and corruption, according to the IMF.
By the end of March 2022, the Washington-based institution said, Kenya is expected to “adopt revised standard bidding documents to obtain consent from beneficial owners to publish beneficial ownership information for awarded tenders in the public procurement information portal (PPIP), and start requiring consent for all new tenders.”
Publishing these names, the IMF noted, will “reduce corruption risks by strengthening transparency and enhancing oversight.”
The revelation of all beneficial owners of companies that do business with the government was to start at the end of June 2021 but was delayed following legal hitches that included the right to privacy.
Revealing of the names is expected to solve the mystery behind the controversial Sh7.8 billion scandal at the Kenya Medical Supplies Authority (Kemsa) in which shadowy wheeler-dealers lined their pockets at the expense of a citizenry that had been hit hard by the crippling effects of the Covid-19 pandemic.
The delay in publishing the rules was due to fear of breach of people’s privacy - an issue that has been solved by requiring beneficial owners to give their consent before signing up for the contract.
In August 2020, Kemsa, which had been legally tasked with procuring Covid-19 protective equipment, caught the attention of the president after being put on the spot over the looting. of Sh7.8 billion.
A report by Auditor General Nancy Gathungu on the procurement scandal at Kemsa revealed that Sh2.3 billion was lost in procuring Covid-19 medical supplies.
Ms Gathungu, who tabled the report before the Senate in September last year, revealed how billions of shillings were unaccounted for and how there was no evidence of budgetary approval by relevant authorities.
The Auditor-General concluded that Kemsa irregularly utilised the Universal Health Coverage budget to procure Covid-19-related items worth Sh7.6 billion.
The audit found numerous violations of the Procurement and Public Finance Management Acts and inefficiencies in the procurement process.
In July 2019, the Attorney General published regulations that required firms to keep a register of beneficial owners, a move that would reveal details of shadowy shareholders in local firms, including foreigners.
This was yet another attempt by the State to combat money laundering, with Kenya joining other jurisdictions such as the European Union in tasking firms to reveal personal details of individual owners with a stake or voting right of at least 10 percent.
The regulation is aimed at unmasking shadowy shareholders who might be engaged in illicit financing or even corrupt practices.