News

By FRANCIS. MUREITHI and HUDSON GUMBIHI

QUESTIONS have been raised over the award of a Shs 840 million (US $12.8 million) contract by the State for the -overhaul of four Russian built police helicopters bought at an inflated price of Shs 4.2 billion nine years ago. According to former Transparency International (TI) Kenya chapter executive director Mwalimu Mati, the contract is a rip-off that will cost taxpayers millions of shillings.

The former TI boss, who now heads anti-graft lobby Mars Group Kenya, claims that the contract was awarded to an Israel company, which does not deal in the MI 17 type of helicopters. The firm won with a bid more than US $4 million (Shs 272 million) above the lowest he claims. The contract was signed last February 7 following a tender process initiated after the publication of the exercise in the local press.

It was advertised as Tender No. KPAW (6) 2006 - 2009 - Overhaul of Four (4 NO.) -17 Helicopters, Systems, Components, Engines and Cockpit/Avionics Upgrade using Restricted Tender. The Government said in Parliament last April 5 that it was in the process of providing hi-tech equipment to deal with crime, including the repair of police choppers, which have been grounded.

Internal Security assistant minister Peter Munya explained to Parliament that plans were under way to repair the choppers and purchase bulletproof vests for the police force. On the same day, Defence minister Njenga Karume explained to MPs that apart from repairing the old choppers, plans were also under way to purchase old helicopters for security purposes.

But Mati is questioning the tender for the repair of the four grounded police choppers. "The contract was awarded to the highest bidder, which is against Procurement rules," he says, and claims that the four choppers, which were purchased in 1998, have so far consumed close to US $15 million (Shs 1.02 billion) each in a deal that Controller and Auditor-General Evan Mwai says was inflated.

"Kenyans are now being asked to spend an additional US $ 12.8 million to overhaul them. This calls for an immediate explanation from the Government as to why we are throwing good money after bad, servicing these second-hand helicopters which have done nothing to improve either our debt or security situation," says Mati. "Kenyans are also entitled to know what action is contemplated against the public officers, ministers, permanent secretaries and police commissioner who have over the years charged our collective account with what is clearly a bad deal worth over (Shs 4.2 billion) US $ 60 million.

He has argued that Israel Aircraft Industries, the tender winner who quoted $12,820,753, does not deal with MI 17 helicopters, and won with a bid more than US $4 million above the lowest bid. Efforts to get a comment from police headquarters yesterday were futile. Neither director of logistics Levin Mwandi, who is directly in charge of procurement and tendering processes at police headquarters, nor police spokesman Eric Kiraithe, could be contacted.

A senior officer who declined to talk on the matter referred us to Mwandi and Kiraithe saying they were the best placed to respond to the allegations brought against the force. According to documents obtained by Mars Group Kenya, bids were opened last October 3 before an evaluation committee, including representatives of the Kenya Civil Aviation Authority, Kenya Air Force, Kenya Police Airwing, Kenya Wildlife Service and the police headquarters.

The bids were from UT Air of South Africa quoting Shs $9,342, 628, Lom Praha S.P of the Czech Republic quoting $9,971,184, Israel Aircraft Industries of Israel quoting $12,820,753, JSC Saint Petersburg Aviation Repair Company (SPARC) of Russia quoting $8,813,760 and Radom Aviation Systems of Israel that quoted $9,945,570.

According to Mati, the previous tender for the overhaul was cancelled last July for irregularities, which would have cost the Government over Shs 100 million. "This award is fraud of the highest order and is very risky for Kenyan airspace," he says. The police bought the four second-hand Russian helicopters (Mi 17) in 1998 from Sound Day Corporation for US $36 million. "Ultimately, these same helicopters have cost Kenyans over US $60 million - and the costs are still rising," says Mati.

Financier Apex Finance Corporation supposedly advanced the money for the initial purchase to the Government. "The trouble is that both Sound Day and Apex are listed by the Controller and Auditor-General Report on Security Related Procurement as phantom entities," says Mati. According to Mati, each of the helicopters cost US $9 million 'about which the Controller and Auditor-General stated: "From the evidence and information gathered, it is evident that the contract was grossly inflated."

Research established that Kenya should have paid no more than US $5 million for each bird. At that time, Mati says, Police Commissioner-General Mohammed Ali indicated that JSC SPARC, the lowest bidder then, was not licensed to deal with Mi 17.

"Apparently, this is not the case," says Mati. He argues that JSC SPARC, which lost out in the July 2006 tender and last February award, is now claiming in a letter of April 2007 to Kenya Anti-Corruption Commission that Israel Aircraft Industries have approached them to sub-contract the work to JSC SPARC.

He says JSC SPARC has refused to accept such sub-contract and have written to KACC to that effect. "The Kenya Anti- Corruption Commission has yet to respond to JSC SPARC. In the meantime, the purported overhaul has yet to begin almost five months after Israel Aircraft Industries won the contract," he says.

Mati has also raised queries about a full-page advertisement taken out by the Kenya Police last December, "The paid statement may have served to deceive as it set out to analyse how each of the tenderers fared in the evaluation of the overhaul contract. A reading of the statement shows that the overhaul is more akin to a reconstruction of the helicopters," he says.

He contends that the statement suggests that nine years after their purchase, one of the helicopters had clocked the manufacturers' recommended overhaul event horizon of 1,500 flying hours. "It's obvious that they spent, most of their time on the ground," he says. He has now called for a commission of inquiry into the matter.