Car auctions: A shocking report that appeared in a local daily has revealed how top of the range State vehicles were auctioned off for as low as Sh. 32,000.
In other cases, vehicles that received bids of up to Sh. 1.8 million were instead sold at lows of Sh. 130,000 only.
Here is the report on the controversial car auctions in the Business Daily:
The Ministry of Labour is on the spot for auctioning top of the range vehicles belonging to the government on the cheap with some being sold for as low as Sh. 32,000.
The ministry is accused of concealing the auction of 17 cars after it advertised the sale on April 7, 2017 in one local daily instead of at least two daily newspapers of national circulation contrary to section 96(2) of the Public Procurement and Asset Disposal Act, 2015.
Auditor General Edward Ouko says the 17 vehicles, including Volkswagen Passat and Nissan Patrol, were all under valued at Sh. 1.1 million.
The cars received bids of Sh. 3.9 million during auctioning, but were sold at a lower cost of Sh. 1.7 million.
Mr Ouko wants action taken against the government officers, auctioneering firm and other parties who colluded leading to loss of public funds and assets.
Mr Ouko’s says in his latest report that although the vehicles were valued and reserve prices set by the Ministry of Transport and Infrastructure, the vehicles were grossly undervalued with some being sold below the bid prices and some “attracting extraordinary bids”.
“Some of the top of the range vehicles were sold for as low as Sh. 32,000,” Mr Ouko said in a qualified audit of the Ministry of East African Community, Labour and Social Protection for the year to June 2017.
Mr Ouko says a VW Passat, registration GK A990T with no visible damage had a reserve price of Sh. 30,000 and attracted a bid price of Sh. 100,000 but only Sh. 32,000 was received from a different bidder.
“GK A 488P, a Nissan Patrol had a reserve price of Sh. 131,000 and attracted a bid price of Sh. 1.3 million but only Sh. 250,000 was receipted,” Mr Ouko said in a report dated July 8, 2018 and tabled in Parliament by Leader of Majority Aden Duale on Wednesday.
The auditor said another Nissan Patrol registration number GK A692Y had a reserve price of Sh. 131,000 but attracted a bid price of Sh. 2.1 million only to be sold at Sh. 145,000.
Nissan Patrol had a reserve price of Sh. 100,000 and attracted a bid price of Sh. 1.8 million but only Sh. 130,000 was receipted. Mr Ouko says fairly new vehicles were disposed off leaving eight old vehicles grounded in the various State department yards.
“It was not clear how the auctioneer was procured and awarded due to various discrepancies in correspondences between the auctioneer and the head of procurement.”
“In consequent, proper procurement procedures were not followed in the identification and award of the auction services,” Mr Ouko said.
He said details of the auction were also not provided for audit verification which could have enabled identification of unpaid and unsold motor vehicles, bid process and the bidders present among others.
The auditor said the winning bidders at the auction dated April 12, 2015 were required to pay 25 per cent deposit at the fall of the hummer but none paid since the payment receipts are dated April 13, 2016.
“In view of the foregoing, the propriety of the auction could not be confirmed and action should be taken against the government officers, auctioneering firm and other parties who colluded leading to loss of public funds and assets,” Mr Ouko said.
