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The Central Bank has been put on the spot after the procurement watchdog nullified the award of a Sh10 billion-a-year tender for printing of the new-look currency to British firm, De La Rue International.
The Public Procurement Administrative Review Board (PPARB) terminated the contract after a week-long hearing in which Swedish firm Crane AB, through lawyer James Gitau Singh, accused CBK of breaching the law in awarding the deal to De La Rue by giving it a 15 per cent margin preference for having local shareholding.
De La Rue beat German firm Giesecke & Devrient, Crane Currency and Oberthur Fiduciaire of France last year to the lucrative contract for printing new notes that are in compliance with the Constitution.
REVIEW
CBK in a statement Monday said it would appeal the review board’s decision at the High Court.
The PPARB panel comprising chairman Paul Gicheru and members Hussein Were, Peter Bita Ondieki and Paul Ngotho called the process of the award to De La Rue “unlawful”, saying CBK abused the 15 per cent local preference clause.
“…De La Rue International Limited was unlawfully awarded the tender for the printing and supply of the new design Kenya currency and bank notes and the application of a 15 per cent preference margin in its favour was unlawful,” ruled the board. “The award of the said tender is hereby annulled.”
The agency further directed the CBK to make a fresh evaluation of the tenders submitted to it within a fortnight.
“(CBK) is directed to undertake a fresh evaluation of all the tenders submitted to it by all the four bidders who participated in the tender process herein and complete the said process within a period of 14 days,” ordered the board.
BIDDER
The agency ruled that De La Rue did not qualify for the preference margin of 15 per cent applied, adding that it was not the lowest evaluated bidder.
De La Rue has had a stranglehold on the Kenya’s lucrative money printing business except for the period between 1966 and 1985 when notes were printed by UK firm Bradbury Wilkinson, later acquired by De La Rue.
The ruling marks yet another botched contract by the CBK.
It means Kenyans have to wait longer to get a much awaited new-look currency. The production of new currency notes that do not bear the images of former presidents was supposed to start after passage of the 2010 Constitution. Kenya must replace all currency with completely new bank notes as the Constitution adopted in 2010 prohibits the use of an individual’s portrait on the legal tender.
The planned replacement will cost Sh18 billion, according to CBK estimates. “The Central Bank of Kenya intends to proceed to the High Court of Kenya to appeal against this determination, as provided for in the law,” said CBK yesterday.
CBK, which was represented by lawyer Ochieng Oduol, sought to have the case heard in camera citing national security concerns. |
