The Auditor-General, Nancy Gathungu, recently flagged major issues surrounding the Central Bank of Kenya’s Sh14.5 billion currency printing tender, casting a shadow over the institution’s reputation.
The tender, awarded to Germany’s Giesecke+Devrient Currency Technologies (G+D), has exposed glaring violations of procurement regulations.
According to Gathungu, the Central Bank failed to establish a special committee as required by the Public Procurement and Asset Disposal Regulations of 2020.
This committee was meant to ensure proper oversight and transparency in the sensitive process of currency printing.
Such omissions raise serious questions about accountability within one of Kenya’s key financial institutions.
In addition, there was no monitoring by the Public Procurement Regulatory Authority, as clearly required under the law.
This lack of oversight creates a dangerous loophole, enabling potential misuse of public funds.
It is concerns that an organization tasked with safeguarding Kenya’s financial system is accused of flouting basic regulations, further tarnishing its credibility.
The Central Bank’s decision to bypass critical safeguards in a procurement process of this magnitude suggests either gross negligence or deliberate mismanagement.
CBK Governor Kamau Thugge defended the tender, claiming it was classified for security reasons and had been approved by the National Security Council and the Cabinet.
However, these justifications do little to explain the failure to follow standard procedures.
While the closure of De La Rue, the former currency printer, and the urgent need for banknotes were cited as reasons for the rushed deal, these cannot excuse ignoring transparency.
The lack of competitive bidding for the tender raises red flags about possible collusion or insider deals, especially in a high-value contract.
The deal involves the printing of 2.04 billion notes of various denominations over five years.
However, the contract’s cost is reportedly higher than previous agreements with De La Rue, despite involving fewer notes.
This discrepancy has led to accusations of financial wastage and mismanagement. How can the Central Bank justify such inflated costs when the country is already grappling with economic challenges?
Such decisions point to a disregard for prudent financial management, further eroding public trust in the institution.
Parliament is now investigating the matter, with lawmakers questioning why proper procurement processes were bypassed.
The issue underscores broader concerns about governance and transparency in handling national resources.
The Central Bank, which should set an example in financial discipline, now finds itself at the center of allegations that undermine its integrity.
Such scandals not only damage the reputation of the CBK but also erode confidence in Kenya’s financial systems.
The Central Bank’s leadership must be held accountable for this blatant abuse of public trust and resources.
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