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{
"id": 1503202,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503202/?format=api",
"text_counter": 442,
"type": "speech",
"speaker_name": "Hon. Farah Maalim",
"speaker_title": "The Temporary Speaker",
"speaker": {
"id": 16,
"legal_name": "Farah Maalim Mohamed",
"slug": "farah-maalim"
},
"content": " Chairperson of the Departmental Committee on Finance and National Planning."
},
{
"id": 1503203,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503203/?format=api",
"text_counter": 443,
"type": "speech",
"speaker_name": "Molo, UDA",
"speaker_title": "Hon. Kuria Kimani",
"speaker": null,
"content": " I rise to move that the Public Procurement and Asset Disposal (Amendment) Bill of 2024 be now read a Second Time. The Bill embodies our commitment to fostering economic inclusivity, promoting local enterprises, and ensuring that public procurement serves as a strategic tool for national development. By introducing clarity to address inefficiencies and reinforcing accountability, this amendment Bill aligns with best practices globally while tailoring solutions to the unique needs of our nation. Public procurement accounts for a significant portion of our GDP. As articulated by economists such as Keynesians, government spending is a vital tool in stimulating economic activity. By channelling resources through fair, transparent and equitable procurement systems, this Bill will not only reduce market inefficiencies but also be a catalyst for the economic growth of our great Republic. Clauses 4 and 10 reflect on the deliberate effort to integrate local content policies. That is a cornerstone of industrial development in many emerging economies. Michael Porter, on competitive advantage, tells us that this will foster local industries, enhance value addition, build competitive industries and strengthen the domestic economy. Prioritising local goods and services in procurement is not merely patriotic, but economically prudent. The provisions of Clause 11 and related clauses are to reserve specific procurement thresholds for local firms. This is a recognition of the structural challenges that are faced by Kenyan contractors. Historically, Kenyan contractors have been side-lined in favour of foreign firms, even for contracts well within the capacity of our local contractors. By reserving contracts that are Ksh1 billion or less for local firms and ensuring joint ventures for larger contracts, we aim to create a level playing field. This approach is consistent with the principle of comparative advantage that ensures domestic firms build expertise in areas where they are best positioned. Moreover, incentivising joint ventures with a monthly 30 per cent local participation ensures technology transfer and capacity building. This Bill expressly says that contracts that are Ksh1 billion and below shall be reserved to local contractors, unless there is no availability of expertise or technology in Kenya, which the Bill envisioned they would not. For contracts that are above Ksh1 billion, we are making it a requirement that they must enter into a joint venture with a Kenyan firm and get 30 per cent of that venture be owned by Kenya. We have outlined that there must be technology transfer where we do not have. This is because we cannot continue to have the hard-earned resources of this country benefiting people from other countries. We should make sure that the resources of this country, through proper public procurement, remain here to ensure economic growth. This Bill also seeks to foster transparency and accountability. Transparency is a linchpin of good governance as it is outlined in best practices, such as the Open Contracting Data Standards (OCDs). Public Procurement Systems must prioritise openness and accessibility to curb corruption and inefficiency. By requiring proper documentation and public disclosures, this Bill will ensure that there is trust in the procurement process, which is very critical for economic and political stability. Clause 13, which expounds on the clarification of tenders, is a practical measure to eliminate ambiguities that often lead to disputes or unfair practices. Clause 22 underscores the importance of compliance by accounting officers emphasising their roles as custodians of public goods. This Bill restores the responsibility of procurement, not just on the accounting officer, but also on the head of the procurement in that entity. This is because sometimes when"
},
{
"id": 1503204,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503204/?format=api",
"text_counter": 444,
"type": "speech",
"speaker_name": "Molo, UDA",
"speaker_title": "Hon. Kuria Kimani",
"speaker": null,
"content": "The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
},
{
"id": 1503205,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503205/?format=api",
"text_counter": 445,
"type": "speech",
"speaker_name": "Molo, UDA",
"speaker_title": "Hon. Kuria Kimani",
"speaker": null,
"content": "mistakes happen, the liability falls on the accounting officer whereas the procurement has been done by the head of procurement. Any impropriety in a tender will impose the criminality to the beneficiary of that tender, so that the beneficiary, the accounting officer and the officer who breached the law, all become accountable, since these are the custodians of our public funds. On matters delayed payments, Clause 30 of the Bill seeks to address that chronic issue. This is a problem that has perpetuated economic stagnation among lower contractors. It is disheartening to see businesses being auctioned every Thursday. And when you look at the kind of businesses being auctioned, it is people with excavators and tippers. By this you can tell the kind of businesses these people do. Delayed payments not only cripple businesses, but also public trust in government systems. Therefore, ensuring that there is timely payment, which is defined here as payment within the quarter, will inject liquidity into the economy and foster a more vibrant entrepreneurial ecosystem. This will align with the liquidity preference which underlines the importance of cash flow for sustaining economic activity. Efficient payment systems are not merely administrative reforms; they are critical economic interventions. This Bill also seeks to expand opportunities for citizen contractors. As I have explained, the proposal to increase maximum contract amount for citizen contractors from Ksh500 million, as currently provided in the law, to Ksh1 billion, is a very significant milestone. This adjustment also reflects an acknowledgement of the evolving capacity of local firms and their readiness to undertake larger projects that are of benefit to this Republic. Therefore, by aligning procurement laws with economic realities, we are going to empower local contractors to scale up their operations, create jobs and contribute meaningfully to national development. The Bill also seeks to ensure that public procurement becomes a tool for inclusive growth. The introduction of penalties for individuals who fraudulently register companies on behalf of foreigners is a bold step towards eliminating anti-competitive practices. Monopolies and unfair competition undermine the principles of market economics, as articulated by Adam Smith, if you are a student of economics like myself, in the book Wealth of Nations . This Bill therefore seeks to promote healthy competition for the benefit of all stakeholders. What we have seen is that international companies come to Kenya and register as local contractors. Chinese contractors will come, pick ID cards of some young people, register as local contractors and get to benefit from contracts that should be given to the young people. There are cases where matters have been taken to court and the directors of the companies have no knowledge whatsoever about the running of the companies. This means it is somebody else using their identity to take advantage of the procurement process and benefit. This Bill will prohibit that. This Bill also provides for technology advancement and skills transfer. Clauses 4 and 20 emphasise technology and skills transfer, which is forward-looking. By leveraging foreign contracts to build local capacity, we will ensure that Kenya reaps both immediate and long- term benefits from international collaborations. This policy will align with the principles of endogenous growth theory, which underscores the role of innovation and knowledge in driving sustainable development. In conclusion, this Bill is more than an amendment. It is a statement of intent. It aligns our procurement laws with evolving economies, technological and governance needs, ensuring that public procurement supports our national development goals. By fostering transparency, building local capacity and addressing inefficiencies, we will position Kenya as a model of economic resilience and inclusivity. Hon. Temporary Speaker, I thank members of the Departmental Committee of Finance and National Planning. This is a Private Member’s Bill. I have been working on it for a few years now, since the last Parliament. I was able to convince the Committee to adopt it as a"
},
{
"id": 1503206,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503206/?format=api",
"text_counter": 446,
"type": "speech",
"speaker_name": "Molo, UDA",
"speaker_title": "Hon. Kuria Kimani",
"speaker": null,
"content": "The electronic version of the Official Hansard Report is for information purposesonly. A certified version of this Report can be obtained from the Hansard Editor."
},
{
"id": 1503207,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503207/?format=api",
"text_counter": 447,
"type": "speech",
"speaker_name": "Molo, UDA",
"speaker_title": "Hon. Kuria Kimani",
"speaker": null,
"content": "Committee Bill, so that we can fast-track it. I really hope that this honourable House will consider it to make sure that we protect local contractors, grow our economy, build our capacity and ensure technology transfer. There is no reason why things like excise stamps used by KRA on bottles are supplied by a multinational. The service comes to us but all the revenue goes back to that particular country. Once we work on this Bill together, we are going to make Kenya a model of economic resilience and inclusivity. With that, I beg to move and request the Leader of the Majority Party to second. I thank you."
},
{
"id": 1503208,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503208/?format=api",
"text_counter": 448,
"type": "speech",
"speaker_name": "Hon. Farah Maalim",
"speaker_title": "The Temporary Speaker",
"speaker": {
"id": 16,
"legal_name": "Farah Maalim Mohamed",
"slug": "farah-maalim"
},
"content": " The Leader of the Majority Party."
},
{
"id": 1503209,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503209/?format=api",
"text_counter": 449,
"type": "speech",
"speaker_name": "Kikuyu, UDA",
"speaker_title": "Hon. Kimani Ichung’wah",
"speaker": null,
"content": " Thank you, Hon. Temporary Speaker. I beg to second this Bill. Since the Chairman of the Committee has articulated its provisions and the real intent, allow me to thank the Committee for having adopted this Bill as a Committee Bill. It indeed addresses very critical issues in our economy. Principally, it is creating or prescribing a threshold of procurements which shall – the word “shall” has been famously used as mandatory – be awarded to local firms in order to promote the growth of local enterprises and local industry. If you look at Clause 21 of this Bill, it seeks to amend Section 149 of the principal Act, the Public Procurement and Disposal Act, 2015 to task the Public Procurement Authority, referred to as “authority” to ensure that priority is given to citizens in subcontracting of tenders. You know the problems the local contractors and entrepreneurs have found themselves in. When the President delivered his State of the Nation Address to this House and to the nation last week, he directed that within the first quarter of next year, e-procurement must become a reality. I was very encouraged. We must deal with the elephant in the room, which is corruption. We keep talking about it. We have forever talked about corruption. Children go to school, grow up and become old and still find people talking about corruption. They also start talking about it themselves and they become corrupt. That is what bedevils our country. It is time we stopped talking about corruption and acted on it. I must commend what the President directed last week that e-procurement should become a reality and not an aspiration. That is the way to go. We must ensure that we no longer just speak about corruption but we are doing something to deal with it. Digitisation and e-procurement will cure in a big way all the issues we have around corruption in the procurement space. Corruption always begins at the procurement level in any organisation. In the process, many of our contractors and entrepreneurs lose opportunities to grow as entrepreneurs. They also lose opportunities to be awarded Government contracts and tenders at the national and county levels and even in State corporations because those with financial muscle come from outside the country and grease the hands of procurement officers in various entities. Therefore, it is important that we have in law a certain threshold of procurement that can never go to other people other than our local entrepreneurs. We have very many people who have the capacity but they never get an opportunity. I had particularly mentioned Clause 21 because you find situations where there is a huge tender worth hundreds of billions of shillings and the main contractor who comes from outside the country comes with subcontractors from his country. That is the case in donor- funded projects…"
},
{
"id": 1503210,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503210/?format=api",
"text_counter": 450,
"type": "scene",
"speaker_name": "",
"speaker_title": "",
"speaker": null,
"content": "(A whistle was heard)"
},
{
"id": 1503211,
"url": "http://info.mzalendo.com/api/v0.1/hansard/entries/1503211/?format=api",
"text_counter": 451,
"type": "speech",
"speaker_name": "Kikuyu, UDA",
"speaker_title": "Hon. Kimani Ichung’wah",
"speaker": null,
"content": "I was wondering who is whistling. But it has gone quiet. As I had stated, that happens, especially with donor-funded projects. You will find, for example, a donor who is financing the construction of a huge highway, maybe from Nairobi Central Business District (CBD) to Moyale insisting that the contractor must be from his"
}
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}