Parliament has shot down a new bid to lock out foreign contractors from bidding for public tender worth below Sh20 billion.
The National Assembly’s Committee on Finance rejected a Bill, which seeks to enhance the limits of tenders where Kenyan citizens are given exclusive preference from the current Sh500 million.
The committee said few Kenyan-owned firms that could afford tenders worth Sh20 billion as proposed in the Bill.
“The committee noted that the leap from Sh500 million to Sh20 billion is astronomically huge. Further, very few Kenyan contractors can afford Sh20 billion,” Homa Bay Women Representative Gladys Wanga, who chairs the Committee on Finance, said in a report.
The committee has backed the position taken by the Treasury and the Institute of Certified Public Accountants (ICPAK) who called for the rejection of the proposed amendments to the Public Procurement and Disposal Act.
“The matter is addressed in section 157(9) of the Act where bidders are required to source at least 40 percent of supplies from citizen contractors. The 40 percent threshold is good enough,” Treasury CAS Nelson Gaichuhie told MPs.
The Treasury and ICPAK opposed the proposed amendments on grounds that the threshold set would inhibit the participation of private firms that can contribute to the economy through the public-private partnerships.
The Treasury and ICPAK raised concern on the capacity of citizen contractors and tender applicants to adequately provide the necessary services that require specialised skills that the market demands.
They also argued that limiting the participation of foreign bidders may hinder technological transfer and building local capacity.