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{
    "id": 862636,
    "url": "https://info.mzalendo.com/api/v0.1/hansard/entries/862636/?format=api",
    "text_counter": 305,
    "type": "speech",
    "speaker_name": "Gatanga, JP",
    "speaker_title": "Hon. Joseph Nduati",
    "speaker": {
        "id": 13338,
        "legal_name": "Joseph Nduati Ngugi",
        "slug": "joseph-nduati-ngugi-2"
    },
    "content": "put a timeframe when the accounting officer should sign any contract which is brought to his attention. Clause 6(3) says that an accounting officer of procurement entity should ensure that all contracts are cleared by the Attorney General. This used to happen in the past but it caused a lot of bottlenecks because the Attorney General would stay with those documents for a very long time. That is why in the new procurement Act this was done away with. If we were to bring it back, we must then say within 21 days, all the tenders with the Attorney General should be signed or returned to the accounting officers. We should also create a timeframe for the accounting officer. After the evaluation that particular contract needs authorisation from the Attorney General. He should be able to do it within a certain timeframe so that he does not stay with it and delay awarding of contracts. We have seen happening in this country. The other important thing that has been raised in this Bill is in Clause 11 where a contracting authority requires a person to give security. That security shall be dealt with in the manner set out in the Public Procurement and Asset Disposal Act. This one has caused a lot of problems especially with local contractors. In the Act it says that performance bond should be in the form of a bank guarantee. You can imagine where a local contractor is undertaking a contract worth Kshs100 million and the performance bond is 10 per cent. That is Kshs10 million. If you walk to a bank and tell it that you want a performance bond worth Kshs10 million, the bank will demand cash cover of Kshs5 million and assets worth Kshs10 million so that in case of default, those assets can be auctioned with ease. That is why I am proposing instead of having a bank guarantee we change it for the local contractors and have an insurance bond. An insurance bond is very good for our local people because you can pay in installments. What used to happen in the past is, whenever a local contractor got a tender, the performance bond would be given in cash, deducted in three equal installments from his payment. In the first certificate you would deduct one-third and in the next certificate, you would deduct the other third. Otherwise, even if we say our local contractors should be allowed to do work worth Kshs1 billion, I am sure that most of them will not be able. With this requirement you will put off most of them. You can look at a contract worth Kshs1 billion with a performance bond of ten per cent. That performance bond will be Kshs100 million. How many of us can afford Kshs100 million in this House apart from Hon. Sankok, nominee No.001? We should review that. Hon. Temporary Deputy Speaker, Government contracts are normally difficult to execute. This is because a Government entity will award a contract knowing they do not have adequate funding to execute it. At times they frustrate the contractor. They take him to the site knowing that they do not have money. I hope Hon. Millie is listening to me. Let us ensure that the Government also provides a contractor with a performance security so that in case the Government defaults, a bank will take up that liability. The same case should apply to a contractor, if they do not perform, their performance bond will be attached. I encourage the Government to follow the NG-CDF example when they are executing contracts. The NG-CDF is the best model which can be used by any Government entity. As a Member of Parliament, you cannot award any contract when there is no money."
}