The National Assembly’s Public Investments Committee on Governance and Education has ordered fresh investigations into the construction of a 1,000-bed students’ hostel at Jaramogi Oginga Odinga University of Science and Technology (JOOUST) after glaring inconsistencies emerged over contract variations, payments amounting to Ksh.844 million and a pending court battle involving the contractor.
The committee, chaired by Luanda MP Dick Maungu on Thursday resolved to summon former Vice-Chancellor Prof. Stephen Gaya Agong for a physical appearance, alongside key project consultants and auditors after finding what members described as “serious grey areas” surrounding the project whose cost ballooned significantly beyond the original contract price.
The project, initially awarded to Sasah General Merchants in February 2010 at a contract sum of Ksh.663.9 million and expected to be completed within three years, eventually attracted certified payments amounting to Ksh.844.1 million.
According to the Auditor-General’s report for the 2023/24 and 2024/25 financial years, the university could not produce documents supporting contract variations amounting to Ksh.180.1 million, while completion and handover certificates were also unavailable during the audit despite the hostel already being occupied by students.
The committee also learnt that the contractor has sued the university in Civil Case No. E002 of 2023, seeking payment of outstanding dues, raising fears that taxpayers could shoulder additional legal costs and penalties if the dispute is not resolved.
Representing the Office of the Auditor-General, Kisumu Regional Office, CPA Kennedy Ongoi warned that the litigation could expose public funds to unnecessary losses.
“Where a contractor takes a public institution to court demanding payment, it means the institution risks paying legal fees and penalties. These are avoidable expenses if projects are managed prudently,” Ongoi told the committee.
The session became increasingly tense as committee members sought answers from former Vice-Chancellor Prof. Agong, who served between 2013 and June 19, 2023.
Prof. Agong told MPs that by the time he left office, the university had paid “close to Ksh.600 million,” maintaining that the final payment certificate only reflected Ksh.4.8 million.
“We had paid close to about Ksh.600 million because the project had just been concluded. The final certificate signed by the university, the consultant and the contractor only bore Ksh.4.8 million,” he said.
However, committee chairman Dick Maungu pointed out that Certificate Number Five, prepared on June 9, 2023 barely 10 days before Prof. Agong left office, showed a cumulative certified payment of approximately Ksh.844 million.
“You exited the university on June 19, 2023, and before you left, Certificate Number Five had already been prepared. It showed a total certified amount of Ksh.844 million. Meaning all this happened within your tenure,” Maungu said.
The chairman further questioned why payments had exceeded the statutory threshold for contract variations provided under the Public Procurement and Asset Disposal Act.
Committee documents indicated that the project had undergone several variations, including additional amounts of Ksh.19.8 million, Ksh.38.1 million, Ksh.44.1 million and Ksh.528,000 alongside another Ksh.79.6 million classified as “fluctuations.”
Maungu said the committee was struggling to understand the legal basis of the additional payments.
“There is something unique called fluctuations amounting to Ksh.79.6 million. We need to understand where this falls under procurement law because fluctuations and variations are different. There is a lot of grey area here,” he said.
Prof. Agong distanced himself from the disputed Ksh.79.6 million, insisting it did not form part of the final accounts he approved.
“The Ksh.79.6 million was not in the picture. If at all it existed, then it was disputed. The final account signed by the contractor, the university and the consultants was only Ksh.4.8 million, not Ksh.79 million,” he said.
The former Vice-Chancellor argued that part of the overall expenditure reflected maintenance works carried out after students had already occupied the hostel.
“The hostel has been accommodating over 1,000 students. Maintenance had to continue, including after a fire incident damaged part of the roof. Some of those costs may have been captured in the global figure,” he explained.
He further defended awarding additional maintenance works to the same contractor, saying bringing in new contractors while students occupied the hostel would have been impractical.
“What would happen is that if a contractor is already on site and understands the project, they remain competitive. It was not necessarily direct procurement,” he said.
His explanation failed to convince committee members.
Kilome MP Thaddeus Nzambia said the matter had become too complex to conclude without hearing all parties involved.
“We need another meeting bringing together the former Vice-Chancellor, the current Vice-Chancellor, the auditor and the contractor because clearly we are not on the same page,” he said.
Lungalunga MP Chiforomodo Mangale Munga also demanded that all project documents be produced for scrutiny.
“We need all documentation on this project so we can verify whether due process was followed in the contract variations and any extensions. The auditor says variations exceeded the legal threshold while the former Vice-Chancellor disputes that. We must establish the truth,” he said.
Central Imenti MP Moses Kirima warned that the committee had “opened a Pandora’s box,” saying emerging revelations suggested there may have been multiple contracts and additional works whose legality remained unclear.
“We need to know who authorised what, at what stage, and whether there was any illegality. We also need to understand why the contractor went to court,” he said.
Bomachoge Chache MP Alpha Miruka, who has construction engineering expertise, advised the committee to reconstruct the project’s entire documentation before drawing conclusions.
“They should prepare a complete file showing the original contract sum, every variation, the reasons for each variation, procurement processes followed and all payment certificates. Once we have that sequence, we shall answer about 70 per cent of the questions,” he said.
Current Vice-Chancellor Prof. Emily Achieng’ Akuno appealed to the committee to help resolve the long-running matter.
“I appreciate Professor Agong for shedding light on this issue. We would like to be free of this matter. Although there is a court case, if the committee can clear what is within its mandate, we shall appreciate it,” she said.
But Maungu maintained that too many unresolved questions remained.
“It is clear that the amount paid exceeded the 25 per cent threshold for variations. It is also clear there are issues surrounding the so-called fluctuations and maintenance costs. The contractor says the university still owes him money while from the university’s position, there are claims that payment may already have exceeded what was due. These are serious matters,” he said.
The chairman directed that Prof. Agong be supplied with all project documents before the next hearing, after the former Vice-Chancellor complained that he had been asked to defend himself without access to the relevant records.
“I requested these documents before appearing but I never received them. It becomes difficult to assist the committee without seeing the documents because some of these records could even have been generated after I left office,” Prof. Agong said.
Invoking the principles of natural justice, the committee agreed that the former Vice-Chancellor should receive all relevant documentation before appearing physically at a future sitting, which MPs indicated could be held at the university.
Maungu said the committee would also consider inviting other investigative agencies if necessary.
“If public money has been lost, this committee will not hesitate to declare who is responsible, who is accountable and who should refund that money,” he said.
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