Railway vs Anglo leasing

Originally Published in the Standard on Sunday on February 2nd 2014

Old Railway

Old Railway

The anatomy of the standard gauge railway project tendering process and the authenticity of the questions raised over the integrity of all parties involved, bear a striking similarity to a previous mega scandal, the Anglo Leasing scam, which happened under the watch of President Mwai Kibaki. First, in the manner in which news of gross irregularities in the tendering process was broken. April 2004, Ntonyiri MP Maoka Maore tables documents before parliament on a company called Anglo Leasing and Finance Company Limited that had allegedly been paid a commitment fee of 3 per cent amounting to over Sh90 million as part of a Sh2.7 billion contract to produce tamper-proof passports for the Immigration department.

Among other things, the documents allege non-existence of the firm and mentions several other dodgy multi million projects the company and its associates are involved with in Kenya. The Public Investments Committee vows to take up the matter. The anti-corruption authority, under the office of the then anti- corruption czar John Githongo also takes cue and opens up investigations. A decade later, Nandi Hills MP Alfred Keter sounds the alarm on what he says is a project with the potential of rivaling Anglo Leasing in terms of bleeding the Kenyan public. On both occasions, reaction to the news follows a similar pattern.

First, pressure is mounted on two young governments both elected on a reform and anti-corruption platform. Graft, a major election point in the manifestos of both the Narc and the Jubilee governments, seems to rear its ugly head again. The damage limitation begins, albeit through different strategies. In 2004, Kibaki’s State House stays mum, and the president’s men are left to their own devices, including intimidating the investigating authorities and eventual coerced resignations. In 2014, Uhuru’s State House speaks out – emphatically.

“The standard gauge railway project must and will go ahead for us to achieve our developmental agenda,” said President Uhuru Kenyatta at a State House media briefing briefing in the company of almost his entire Cabinet. “The railway is transformative. It is the single biggest investment in our economy in 50 years; and the single biggest investment in East Africa in decades.”

But in his public silence, Kibaki was slowly making sure his house was being put back in order. A series of resignations of ministers under whose docket the scam fell, followed the exposure. None of them accepted responsibility. All of them were acquitted by courts of law at different times.

“I resigned because of the constant harassment by the media and not because I was guilty,” said Daudi Mwiraria, who was the then minister of Finance. He nevertheless went ahead to accuse Githongo of being used by the West. “I can describe my relationship with Githongo as cordial until I came to know whatever information he got, it got to foreign diplomats before it even got to the President,” Mwiraria said. He called Githongo a “serial liar” out to tarnish his name.

Kiraitu Murungi, who was the Energy minister also resigned but affirmed his innocence. Systematic looting “I want to make one thing very clear: I have not been involved in corruption. Many things have been said about me, but deep inside me I know for certain that I did not play any part whatsoever in the Anglo Leasing deal.” This is despite the fact that he was among those adversely mentioned by investigators as having played a role in the Anglo Leasing scam.

“Your Excellency, I updated you on progress, including the fact that senior officials in government were possibly implicated in the unfolding saga. Those mentioned by the investigators at this stage included Moody Awori, Kiraitu Murungi, David Mwiraria, Chris Murungaru, PS Home Affairs, Sylvester Mwaliko, PS Finance Joseph Magari, PS Internal Security David Mwangi, Alfred Getonga, Deepak Kamani and Jimmy Wanjigi,” read a letter by Githongo to President Kibaki.

The correspondence was a bid by Githongo to alert the President of the goings on in his government. The solidarity in denial of any wrongdoing by the Uhuru Cabinet persists even in the face of unclear procurement procedures and legal advice. “Where we use development partner’s money, in spite of us having a percentage that we contribute, we have always used procurement laws of the development partner who is providing the money,” Transport cabinet secretary Engineer Michael Kamau has said.

In terms of the overall cost of the project, figures given by his Finance counterpart differ with his. While Engineer Kamau says the project will cost Sh327 billion, Henry Rotich projects the total cost will be Sh447.5 billion. The Attorney Generals who served under the two regimes both distanced themselves and continue to distance themselves from the scams.

At the height of the passports and security tenders, current Busia Senator Amos Wako said he played no part in facilitating the project. Wako, while appearing before a parliamentary committee, said that he delegated the duty of giving legal advice on the contract to a junior officer and only appended his signature to the project. The former AG had received correspondence from the then Home Affairs PS Sylvester Mwaliko, requesting his legal opinion on the contract.
“I only give legal opinions to weighty matters and did not feel that the one in question required any special attention,” he said. Current Attorney General Githu Muigai has not only maintained his non-involvement in issuing advice but also pointed out the illegality of the procurement process.
“This office has not seen any document of a government to government agreement between Kenya and China…it is worrying that a procurement entity can pick and choose alternative procurement methodology…this shouldn’t happen,” Muigai said while appearing before the PIC last week.
He later on said that there was nothing wrong with the contract. “From where we sit and from the legal side there is nothing that has happened yet that gives the opinion that there is any cause for alarm.” Both the Anglo Leasing and Railway contracts touched on the highest offices of the land thus meriting comment from not only their presidents but from their deputies as well.
Kibaki’s deputy, Moody Awori had been adversely mentioned in the Anglo Leasing scam. Naturally he was forced to defend himself and stayed the course and did not resign over the scam. In an attempt to clear his name, he too vilified the anti corruption crusaders. “I regret to say that the report contains glaring fundamental errors which seriously undermine its credibility. These errors include misapprehension of facts, distortions of facts and findings made without evidence,” Awori said. At the time, as Leader of Official Opposition, President Uhuru Kenyatta was vocal in the importance of following the law.
He insisted that the country waits for publication of findings of the PIC, which he headed at the time. “What we are actually investigating and looking into is a major systematic looting of the public coffers, for private gain, by a few individuals and businessmen, who are aided and abetted by a few senior and junior officials of government,” said Uhuru adding that the evidence produced by Githongo was conclusive and implicated a local and international mafia cartel involved in the security contracts.

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