The government was forced to pay a whopping Ksh 4.3 billion as interest charged on delayed payments for 15 projects. Auditor General Nancy Gathungu said the interest could have been avoided if the payments had been made.

The interests relate to loans procured by the government for various projects. The affected projects include those relating to Covid-19, projects in the water sector, and road projects being done by the Kenya National Highways Authority (Kenha)

Concerning the Covid-19 Health Emergency Response under the State Department for Medical Services, the report shows that the department had accrued interest of Sh930.59 million due to the delay in the settlement of accounts for the supply of Covid-19 vaccines.

The Kenya Water Security and Climate Resilient Project (IDA) for the State Department for Irrigation had accrued interest on late payments totalling Sh70 million; the Coastal Regional Water Security and Climate Resilience Project under the State Department for Irrigation was charged interest of Sh178.6 million due to delays in the payment to the contractor on certified works.

The Sh21 billion Kibwezi-Mtomo-Kitui-Migwani Project under Kenha, which was financed by Exim Bank, has attracted interests of Sh614.2 million arising from delayed payments to the contractor for the upgrading of the said road.

The road was constructed by Sinohydro Corporation of China and traverses Makueni and Kitui counties.

Avoidable interest

For the Kapchorwa-Suam-Kitale and Eldoret bypass project also by Kenha, the contractor has lodged a claim of Sh318.6 million in respect to interest charges caused by delays in the implementation of the project by the employer, the Kenya Nairobi Western Bypass Project has been charged interest of Sh4.6 million due to delayed payment for construction of roads and acquisition of land.

The Water Sector and Sanitation Development Project under the State Department for Water and Sanitation is facing avoidable interest of Sh22.4 million incurred on delayed payments for water distribution works for Malindi, Gongoni and Mambrui, the second Baricho – Kakuyuni Water supply project and water distribution works in Watamu projects.

The Mwea Irrigation Development Project under the National Irrigation Authority (NIA) has accumulated interest of Sh43.1 million paid due as penalty on late payment for construction of Thiba Dam while roads 2000 Phase Two in Central Kenya being done by the Rural Roads Improvement and Maintenance Project under the Kenya Rural Roads Authority (Kerra) has interest claims of Sh3.6 million and 50 per cent arbitration fee of Sh1.2 million resulting from delayed settlement of a principal amount of Sh30.9 million awarded by the Arbitral Tribunal for arbitration proceedings.

The delays of payment for Sirari Corridor Accessibility and Road Safety Improvement Project along the Isebania-Kisii-Ahero has attracted interests of Sh657 million after two construction companies charged interest on delayed payments of Sh 331.1 million and Sh 325.89 million.