KENYA’S government has spent millions on contracts for security projects that lawmakers and the public were barred from scrutinising, leaving a loophole for corruption, according to a report published yesterday.
The government borrowed money at nearly 28 percent in annual interest rates to pay for some of the contracts – four times the prevailing interest at the time, according to a report by the independent Institute of Economic Affairs. This year, the government has set aside millions of dollars to repay loans for security contracts, the report said.
“It should be noted that such contracts are not subject to public scrutiny, neither are they subjected to parliamentary scrutiny. Often they are not subjected to established government procurement procedures,” according to the report.
“These omissions make them very prone to corruption.”
President Mwai Kibaki has come under increasing pressure to crack down on corruption by key allies accused of crafting some of the security contracts in an effort to raise funds for next year’s election.
Two of the schemes, involving a fictitious company known as Anglo Leasing, have led to the resignation or firing of three Cabinet ministers.
Another minister resigned from Kibaki’s government after accusations that he was involved in Kenya’s biggest financial scandal, one orchestrated under the notoriously corrupt regime of former President Daniel arap Moi.
Kibaki’s government had set aside nearly nine billion shillings (US$124 million) to service loans taken to pay Anglo Leasing and other companies that had won security contracts, according to yesterday’s report.
