CA buys its staff wallets at a price of Sh6,500 each

The Communications Authority of Kenya (CA) is on the spot once again for profligate spending of public funds that saw it sink Sh1.95 million into the purchase of 300 leather wallets for staff.

The agency, which is the telecoms and broadcasting sector regulator, bought the wallets at a cost of Sh6,500 each or more than five times the market price, according to an audit report seen by the Business Daily.

The agency’s internal auditors established that similar leather wallets at Woolworths cost S,500 each for men and Sh4,000 a piece for women.
The price at Pure Leather Wallets stood at Sh2,500 each while Gift Centre offers the wallets at Sh1,200 each for both men and women.

This means the CA would have saved Sh1.59 million had it bought the leather wallets from Gift Centre.

The wallets expenditure is contained in a dossier which also shows that CA staff pocketed S07.2 million in tax-free travelling allowances in the year ended June.

The audit report into the financial dealings of the telecoms industry regulator has questioned the spending on the 300 leather wallets as gifts for staff and raised the red flag over the agency’s use of direct procurement contrary to public procurement law.
The CA is one of Kenya’s most liquid State agencies, with a procurement budget of Sh1.8 billion in the year ended June 2015.

The auditors said a critical examination of the tenders established that they lacked “critical information such as who and when requisitions were made, when the goods were issued, who issued the goods and who received the goods”.

READ: CA defends hefty pay to board members

Digital Print Media Ltd, a Nairobi-based printing firm, won the deal to supply the branded wallets, according to the internal audit report. Out of the total 300 wallets, 165 were for men and 135 for women.

The auditors established that CA executives could not account for the 300 wallets and that there was a variance in the quantity ordered and the staff headcount. The agency had a total of 189 employees at the end of June 2015.

“The staff giveaway was for 300 wallets and a listing of the receipts of the wallets was not provided,” says the report that the agency’s board audit committee adopted on September 9, 2015.

The Francis Wangusi-led CA now joins the list of government agencies caught in wanton spending of taxpayers’ cash through buying goods at exorbitant prices.

Bungoma governor Ken Lusaka bought 10 wheelbarrows at Sh109,320 apiece while his Kajiado counterpart, David Nkedianye, reportedly spent Sh2,250 per plate of lunch for 20 guests.

Mike Ukili, the chief executive at Digital Print Media Ltd, declined to comment on this story.

The audit report also questioned why the CA single-sourced a Sh110.9 million digital migration awareness tender to Scanad, a unit of listed marketing services firm Scangroup.

Mr Wangusi said the authority had a two-year contract with Scanad to provide integrated communication services, hence the decision to use the firm to prepare aerts and art work during the digital migration period.

The tender lapsed in June and was awarded to Transcend Media Group, the director-general said.

The CA also directly procured expansion of broadcast logger capacity from New Edge Solution Ltd in a deal worth Sh24.6 million in April, the audit report shows.

SOURCE: BUSINESS DAILY