NSSF managers quizzed over multi-billion projects

Politics and policy

Mr Anthony Omerikwa when he appeared before the Public Investments Committee in Nairobi on April 22, 2015. Acting NSSF Managing Trustee Anthony Omerikwa was hard-pressed to explain how tenders were awarded when he appeared before the Public Investments Committee to shed light on three massive projects the fund is undertaking. PHOTO | EVANS HABIL | NATION MEDIA GROUP 

By EDWIN MUTAI, emutai@ke.nationmedia.com

In Summary

• PIC took NSSF to task to explain how it tendered and awarded three multi-billion shilling projects.
• The acting managing trustee was also unable to provide cost estimates for the three joint ventures.
• Members of the parliamentary committee expressed concern that NSSF stands to lose billions in the deals.

Acting managers of the National Social Security Fund (NSSF) on Wednesday failed to explain how pensioners stand to benefit from multi-billion shilling projects in Mavoko, Kenyatta Avenue and Hazina Trade Centre.

Acting managing trustee Anthony Omerikwa failed to provide expected returns on investments in the 1,010-acre proposed development of housing units in Mavoko, Machakos County, and the proposed development of multi-story business complex on NSSF’s 3.6 acre plot on Nairobi’s Kenyatta Avenue.

The NSSF managers could also not explain cost estimates for the projects when they appeared before the Public Investments Committee on Wednesday.

The committee, chaired by Eldas MP Adan Keynan, questioned how China Jiangxi International Ltd won the tender for the development of Hazina Trade Centre in the second bid when it had been disqualified in the second one.

The MPs also questioned how NSSF allowed Jiangxi to adjust the cost of the bid by Sh115 million during the technical evaluation that saw only two companies compete for the Sh6.7 billion tender.

China National Aero Technology had bid Sh6.74 billion while Jiangxi, after adjustment, won the tender at Sh6.72 billion from Sh6.6 billion. PIC expressed concern that the NSSF could lose billions in the Mavoko housing project alone.

“We have information that NSSF stands to lose up to Sh100 billion in the Mavoko Joint Venture for the development of 60,000 housing units. None other than Cotu secretary-general Francis Atwoli has written to us and this has been corroborated by stories published in two leading newspapers,” Mr Keynan said.

In the Mavoko investment plan, the NSSF acting managing trustee only indicated that the fund will spend Sh2.7 billion being the total value of the 1,010 acres of land.

“We will only invest in land and the joint venture partner will invest the rest. The proceeds from the sale of these houses will be shared proportionately between the partners based on their respective investment,” the NSSF said. Mr Omerikwa said he could not provide the total cost of the investment since the NSSF will only invest in its land valued at Sh2.7 billion.

Mvita MP Shariff Nassir drew the attention of the committee to a valuation certificate by Crystal Valuers done in 2012 which stated that the total value of the Mavoko land stood at Sh3.4 billion.

The committee was irked when the management refused to disclose whether NSSF had undertaken a feasibility study, designs and engineers estimates before it tendered the project through a restricted bid.