E-Clips:- Business Pictorial - Awori To Be Quizzed Over Sh2.7b Passport Scandal

Vice-President Moody Awori is among four people to be questioned over the Sh2.7 billion passport scandal, as more details emerged yesterday. The four, who include two permanent secretaries and the principal immigration officer, are to be quizzed by the Parliamentary national security committee, next Tuesday.

"This is turning out to be another Goldenberg scam," said committee chairman David Mwenje. He added: "I have Government documents detailing the scandal." His committee wants to know why the Narc Government offered to pay Sh2.7 billion for a secure passports system when the lowest tender was around Sh936 million.

It meant the Government would have paid about Sh1.7 billion more than necessary. The scandal, revealed by the Nation on Wednesday, would have seen someone at the Immigration Department pocket the extra cash, according to Kanu MP Maoka Maore. Some people are now shy to talk about the present graft but are happy to talk about the past," he added.

The deal was for urgently needed secure passports, laminating machines and computer software. But instead of accepting the lowest tender, procurement officers in Immigration held onto the tenders until the last moment then supported the highest bidder, Mr Maore told MPs. He said the tender had been awarded irregularly and then accused the Government of harping on about corruption during the previous Government of President Mopi, but ignoring looting going on in President Kibakis own time.

Now the security committee is to question VP Awori, in his role as head of the Home Affairs ministry which oversees Immigration, plus Finance PS Joseph Magari, Home Affairs PS Sylvester Mwaliko and Principal Immigration Officer Henry ole Ndiema. Although the Clerks office at the National Assembly had been made aware of the intention to quiz the four, they have not been sent formal summons, as is the normal procedure.

In announcing the move, Mr Mwenje said Narc was voted to power partly on its promise to fight corruption. "This is what we told voters we will do; we will not allow any impropriety to take root," he said. In blowing the whistle on the deal in Parliament on Tuesday, Ntonyiri MP, Mr Maore tabled some of the documents about the deal which showed the Treasury had already paid Sh90 million to a firm in the United Kingdom.

According to the documents, the firm – Anglo Leasing & Finance Ltd of Alpha House, Liverpool – was awarded the tender to supply computer hardware and software, 300,000 passport documents and lamination films for passports. The tender was supposed to streamline issuing passports, mainly by setting up machines to laminate them. Plans to buy computers for the project were laid in October 2000 by

President Mois government and it was at an advanced stage when Narc came to power in January last year. Bids had already been received and evaluated and it remained only to award the contract. During evaluation process, three internationally respected companies were identified as technically able to do the job: Face Technologies of South Africa, GET group of the United States, and De La Rue of the United Kingdom.

When Narc came to power there were two major attempts to scuttle the process. Firstly, the Treasury asked Immigration to halt the purchase, saying all three bidders were not qualified. And secondly, Immigration was again asked to stop the job when, in May 2003, Narc stopped all procurement in all ministries as part of a shake-up of its buying procedures to weed out corruption.

The first move came, also in May 2003 when the Treasurys Dr Wilson Sitonik wrote to the immigration chief, Mr ole Ndiema, saying none of the bidders was qualified to do the job. Dr Sitonik, director of Government Information Technology Services, which vets all computer procurement projects in the public sector, wrote on May 27: "None of the proposals is qualified and there is no justified basis for awarding them contract at this time." Instead, the Treasury came up with its own suggestion of projects which Immigration should implement.

It suggested the secure passports plan should be expanded into a so-called "turnkey project" with several components. Turnkey projects come with their own financing deal, with money being lent to the Government by a foreign lender on commercial terms. And, because they are negotiated secretly between Government officials and vendors, agreements invariably provide for huge advance payments in "mobilisation" and "arrangement" fees.

They are structured so that by the time any irregularities become public, millions of shillings will already have been paid, making it impossible for the Government to discontinue them. Thus, what was supposed to be a simple plan to improve issuing secure passports, costing a few hundreds of millions was now to be transformed into a multi-billion project which would take years to implement.

On may 27, 2003, Mr ole Ndiema wrote back to the Treasury pleading to be allowed to continue with the smaller project, and lamenting that passport issuing which was in place had become obsolete.

He informed the Treasury that the supplier of the 10-year old existing passport had long stopped servicing it and that spares for major components were not available internationally. Ndiema said that the scope of the project suggested by the Treasury was way beyond immigrations financial capacity. He said a project of the magnitude and complexity suggested by the Treasury would require phasing in several years and that no other country had such a system.

"No country in the world has such a system", he said. Mr ole Ndiema pleaded with the Treasury to allow him to proceed with the plan that was already in place pointing out that he already had a budget for it.

"This department has been allocated Sh180 million during the current financial year and of procurement s differed, the funds will remain un utilised for the purposes it was assigned", he said. Two days later, ole Ndiema was forced to write another letter- this time- to the permanent secretary in the office of the vice president and ministry of home affairs, Mr S. Mwaliko, pleading that the passport project be exempted from a government directive which ordered the suspension of procurement of government services.

He reiterated that the existing passport was outmoded and unable to cope with the present demand for passports. What happened thereafter is not clear. But going by the documents which were tabled in parliament by Maore, the pleas by ole Ndiema were ignored .

The government decided to proceed with the single-sourced multi-billion turnkey project.

According to the documents which were tabled by Maore, the government has already paid half f what it would have paid if it had proceeded with the original project. Most of the controversial projects of the Moi regime were turnkey projects. They include, Eldoret Airport, the purchase of the presidential jet, the Turkwell power project, and the Bullet factory in Eldoret.