Treasury Cabinet Secretary John Mbadi.
At 3:30pm on Friday, November 22, a day after President William Ruto announced cancellation of the Adani deals, a senior team assembled work out the legal documents to terminate the contract with the Indian conglomerate.
The revelation was made on Thursday by National Treasury Cabinet Secretary John Mbadi when he appeared before the Public Debt and Privatisation committee, where he assured MPs that taxpayers will not incur any cost from cancellation of the deals.
Mr Mbadi told the committee that he is fully aware of the sitting of the team that terminated the contract telling the lawmakers that there is no going back on the issue since the President had pronounced himself on it during the State of the Nation address.
“This was a communication that was done at the highest level, that is, the President, and he did it in Parliament. You should have comfort that communication made at such high level, there is no going back,” Mr Mbadi told MPs referring to the president’s decree during his State of the Nation address in Parliament.
In the team, were representatives from the directorate of Public Private Partnerships (PPS) domiciled at the National Treasury, representatives from the ministry of energy, Kenya Electricity Transmission Company Limited (Ketraco) and representatives from the Jomo Kenyatta International Airport (JKIA).
“They all sat at 3:30pm together with the legal team to properly execute the cancellation,” Mr Mbadi told the committee.
The Treasury CS assured the lawmakers that taxpayers will not lose any single cent occasioned by the cancellation.
“The JKIA case, I have said before that there was no contract, it was at the initial stages so members should have comfort that there is no money that we will lose from where I sit,” Mr Mbadi said.
“We are getting comfort that there is no cost on us, that one I can tell you members,” he added.
The question was put forward by nominated MP Suleka Harun who called on Mr Mbadi to confirm to the committee and country that no money will be lost on the cancellation of the Adani deals.
“Now that you are here CS, can you confirm to us on this Adani, Kenyans will not lose any money?" Ms Harun asked.
Kitui Central MP Makali Mulu who chaired the session however warned that if there will be any payment that will be made due to the cancellation of the deal, then the people who made the payments will be held liable.
“It is our hope that taxpayers’ money will not be lost, but if there is any payment that has been made, then those who made the payment will be held responsible,” Dr Mulu said.
Mr Mbadi’s statement came just a day after the High Court ordered the state to produce evidence to substantiate claims that the Adani-JKIA deal has been cancelled.
On Thursday last week, President Ruto, during his State of the Nation address, cancelled the Adani Group takeover of the Jomo Kenyatta International Airport, where the Indian firm was to take over the airport’s renovation at a cost of Sh238 billion and manage the operations of the country’s largest airport for 30 years.
The President’s cancellation order came after the US authority’s indicted Adani Group founder Gautam Adan and seven others for allegedly paying Sh34.3 billion in bribes to win a tender.
Also cancelled by the President was the Adani Group Sh96 billion contract with Ketraco where the firm was to build electricity transmission lines.
Under the PPP deal, Adani was to construct a 206km 400KV Gilgil-Thika-Malaa-Konza power transmission line to boost supply around Nairobi. The line was expected to be completed in 2027
It was also to build the 70km 132kV Menengai-Ol Kalou-Rumuruti transmission line, providing an alternative evacuation path for the Menengai geothermal complex. The line was slated for completion in 2008.
Further, Adani was to build two substations, the 132kV Thurdibuoro substation and the 400/220/132kV substation at Rongai which were scheduled to be completed by the year 2028
There have been fears that the cancellation of the deal may lead to possible financial implications to the government due to breach of contract after signing.
Such breach of contracts in previous contracts have led to taxpayers paying billions of shilling in terms of penalties to the contractors for little work which is not commensurate to work done or claiming payments for no work done at all.
For instance, in the botched JKIA Greenfield, two Chinese firms, Anhui civil engineering Group and China Aero Technology Engineering International Corporation sought for Sh5.6 billion consisting of balance of contract for bill of quantities, extra quote claim, VAT and interest and penalties.
