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Recipient of Sh4bn for Arror dam unknown - Ouko.

The recipient of Sh4 billion advance payment for works on Arror dam project in Kerio Valley is unknown, Auditor General Edward Ouko has said.

The revelation is contained in an audit on massive irregularities in the contract awarded to Italian firm CMC Di Ravenna for construction of the dam.

Ouko, in the review of Planning Department's accounts for the last financial year, says the Sh4 billion payout was irregular.

It has also emerged that the payment was not dated, recommended by the Kerio Valley Development Authority technical services manager or approved by the CEO.

'There is no evidence of who was paid the money, when, and by whom. There was no detail provided for audit to show who granted the authority to pay the amount,' Ouko says.

The auditor further says there was no evidence or correspondence to show that the payment - 15 per cent of the contract sum - was made to the contractor by the financier.

This was to be done upon obtaining the necessary approvals and after ensuring there was delivery and compliance with contract terms, which was not the case for the Arror project.

'Though the advance payment was made through a memorandum payment voucher dated December 7, 2017, no work has been done on the ground to cover the payment,' the auditor reveals.

The project's financing agreement amounting Sh23 billion was signed in April last year.

The terms were that the loan is repaid for 15 years at a floating interest that was to be determined by the agent.

Ouko also raises concern that despite massive withdrawals from the project fund account, no compensation had been made to the affected community members.

An inspection in April further revealed that Kenya Forest Service had not ceded part of the forest that was to be used for the dam.

Arror and Kimwarer dam projects by KVDA are the subject of investigations by the Directorate of Criminal Investigations.

This followed allegations that the government lost Sh21 billion meant for the two dams whose works have since stalled, a situation worsened by CMC Di Ravenna's cash woes.

Deputy President William Ruto, in defence of the state, earlier said only Sh7 billion had been advanced to the contractor.

Ouko reveals that there was no environmental impact assessment report to back up the feasibility study submitted in May 2012.

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Publication:The Star (Nairobi, Kenya)
Date:Jul 9, 2019
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