Auditors say the State Department Management was in breach of the law in failing to implement the framework contracting process
The supplier who was to supply corn soya did not deliver the required quantities.
Image: WINNIE WANJIKU
Education officials are on the spot over alleged mismanagement of Sh1.1 billion that was meant for feeding children to keep them in school in hardship areas in the last fiscal year.
An audit of the funds shows that ministry officials bungled the ministry’s direct allocations for the cause but also grants by various donors.
A case in point is a project where donors contributed cash for meals to keep learners in school during the Covid-19 pandemic.
However, contractors failed to deliver the tendered quantities with auditors also raising the red flag of procurement irregularities.
The ministry sought to purchase 107,000 bags of rice, 25,749 bags of 90-kg beans, 12,780 jerricans of vegetable oil, 5,112 bales of salt, and 194,421 bags of corn-soya blend.
The auditor has, however, sounded the alarm over the procurement process the state Department of Basic Education and Early Learning adopted in the purchases.
Gathungu revealed that the department adopted a framework contract from Public Works and requested quotations from only one firm to supply corn soya from a list of 28 suppliers.
Three firms were requested to supply salt and five to supply vegetable oil contrary to the law.
Gathungu said the anomaly followed that the department chose a method that was not in tandem with the quantities they were buying.
She said the procedure applied should be where the required goods, works, and non-consultancy services cannot be determined at the time of entering into an agreement.
The law requires that a minimum of seven alternative vendors are included in each category.
But in the case under review, the supplier who was to supply corn soya did not deliver the required quantities.
The arrangement was that the supplier was to supply 25kg bags of corn soya at a unit cost of Sh3,250 whenever required.
The supplier was issued with four LPOs which were partly delivered and some canceled by the State Department.
Instead, the supplier delivered a paltry 4,450 bags with further anomalies cited after it emerged some of the documents used in the tender were backdated.
The vendor had said in a letter dated May 12, 2022, that the firm would deliver 79,126 bags of corn soya. The firm was paid Sh14.4 million.
“It was also observed that the clause on liquidated damages was not effected when paying for the part delivery of LPO 2143," the auditor general said.
“The contractor communicated one month later after receiving the Local Purchase Orders and it is not clear at what point the cancellation of orders was effected or by whom.”
It has also emerged that two LPOs were issued after the expiry date of the contract, contrary to Public Procurement and Asset Disposal Act, 2015, which sets the validity at 30 days.
“It is also not clear whether the State Department appointed a Contract Implementation Committee to report on the way forward with regard to the implementation of the contract,” Gathungu said.
In addition, four firms had been recommended for the supply of beans and had entered into contracts with the State Department but failed to supply.
“Minutes of a meeting held January 10, 2022, stated that the delay had led to undocumented dropout of learners from the arid and semi-arid areas.”
The auditor is further concerned that the State Department did not take any action against the suppliers after failure to deliver besides cancellation of their Local Purchase Orders.
“It was noted that the State Department did not escalate the matter to the State Department of Public Works after the contractors failed to perform.”
In the circumstances, failure to deliver the required food ration is an indication of inefficiencies in the procurement process within the State Department, Gathungu said.
She said the events “negatively impacted the school feeding programme and thus affected the performance of students in school due to absenteeism.”
While at it, the framework contracts signed made provisions for performance security, referring to the special conditions of the contract for specifics of the performance security.
A review of the contract documents, however, revealed that the special conditions of the contract had no provisions for performance security.
“There was no evidence that any of the contracted firms presented the State Department with performance security," she said.
“Additionally, there was no evidence that the compensation from the performance bonds had been effected for the suppliers who failed to deliver."
Gathungu said this was an indication that due diligence was not undertaken when signing the contracts.
“In the circumstances, the State Department Management was in breach of the law in failing to implement the framework contracting process thereby locking out other potential suppliers,"
“Further, value for money may not have been realised in the redistributed foodstuffs as the redistribution affected the nutritional value as planned.”
Several anomalies were also cited under the Covid-19 Learning Continuity Basic Education Project implemented by the department.
There were material variances noted in the enrolment numbers in the beneficiary schools and the enrolment as per the approved list.
“In all the sampled schools, the enrolment was higher than the numbers quoted in the contract. The basis of the enrolment list used to do the procurement could not be confirmed.”
Also flagged is that the procurement for the blended meal was entered into the procurement plan on the same day that the vendor was awarded the contract for the supply of the blended corn-soya meal.
The list of schools identified to benefit from the project was amended to include other schools that were not on the initial list.
Variances were noted in the approved supply list and the actual number of bags supplied
The project management did not provide the schools with clear instructions on the usage.
“This led to some schools issuing the foodstuff to parents for use at home instead of having it prepared in schools,” the auditor said.
Gathungu added that the basis of distribution was not provided.
“Field verification revealed that some schools were given more than the required amounts leading to the fortified meals expiring before use.”
She further pointed out that documentation on deliveries of the fortified meals was not provided in most of the schools.
Issues with counties
In Kajiado and Machakos counties, the project management delivered fortified food amounting to Sh2,030,569 and Sh1,209,544 on 28 and 29 June, 2021 respectively.
However, Gathungu revealed that the County Director of Education, Kajiado County was not able to confirm receipt of the corn-soya blend received in his county.
“A visit to sampled schools revealed that no flour was delivered to the primary schools.”
In Machakos, verification of the identified schools also confirmed the fortified food was not delivered to the schools.
In Isiolo, 72 bags were never delivered as only 845 were traced out of the 917 bags of fortified food the management said it had procured.
In Kisumu, no documentation was provided for review to confirm the deliveries.
“Further, the Sub County Directors of Education were not aware of the program as the corn-soya blend flour was directly distributed to schools.”
(Edited by Tabnacha O)