The National Assembly on Wednesday, April 17, investigated a case where a Chinese contractor constructed a 15-floor building instead of an initially agreed plan of 36 stories.
This anomaly was discovered during the interrogation of the National Social Security Fund's financial statements for the 2019/20, and 2020/21 Financial Years.
Parliament through the Public Investments Committee on Social Services summoned the contractor to explain the anomaly.
“Among the pressing issues discussed was the discrepancy in the construction of the Hazina Trade Center in Nairobi Central Business District (CBD), originally planned for 36 floors but reduced to 15 floors, despite an initial upfront payment of approximately Ksh4 billion,” the Committee released a statement.
The Committee was led by Navakholo Member of Parliament Emmanuel Wangwe.
According to financial statements from NSSF, in the 2020/2021 financial year, a one-off project claim of Ksh871 million was paid in respect of the Hazina Trade Centre.
This amount was part of the billions paid to the Chinese contractor overseeing the project.
In total, NSSF estimated the whole project to cost Ksh4.2 billion with Ksh3.2 billion paid in 2020.
On why the building was cut to 15 floors, NSSF in its financial statements stated, “The project entailed the elevation of the existing building into a 36-floor tower. The project was later scaled down to 15 floors at a reduced contract sum of Ksh4 billion out of an original contract price of Ksh6 billion.”
Through own admission, NSSF reduced the size of the building by 58 per cent of the original contract but only reduced the cost by 39 per cent.
NSSF defended the project remarking that 36 floors would have forced tenants to look for parking spaces elsewhere.
Despite billions poured on the project, NSSF was reported not to be recouping money spent through rental income.
For example, a medical college with offices at both Hazina Trade Centre and View Park Towers (all owned by NSSF) presented fake banking slips totalling Ksh.9 million purporting these to have been transacted for rent payments.
