MPs probe multi-billion-shilling rice import scandal, demand answers from Mvurya

The Senate has called on Investments, Trade, and Industry Cabinet Secretary Salim Mvurya to explain alleged irregularities in the importation of rice worth billions of shillings through the Kenyan National Trading Corporation (KNTC).

The questionable deals, as pointed out by Marsabit Senator Mohamed Chute, have sparked calls for greater scrutiny amid claims of mismanagement and favouritism in the government's handling of food supplies for struggling Kenyans.

Senator Chute's formal request for a statement filed in the Senate tasks the Trade, Industrialisation, and Tourism Committee with investigating the KNTC's rice importation records.

The senator wants answers regarding the quantity of rice imported, its cost per kilogramme, and the companies involved in supplying it. He is also pushing for transparency on whether the government flouted procurement rules outlined in the Public Procurement and Asset Disposal Act.

“The committee should disclose the names of companies that were awarded the contracts for the supply of rice, indicating the respective quantities delivered by the companies so far vis-à-vis what they were contracted to deliver,” said Senator Chute. He further emphasised that only complete transparency could shed light on the potential misuse of taxpayer funds.

The call for an investigation comes on the heels of another scandal at KNTC involving Sh6.5 billion in irregularly imported edible oil, which led to the sacking and prosecution of the agency’s Managing Director Pamela Mutua, along with several senior officers. This incident has intensified public concern and spurred action from agencies such as the Ethics and Anti-Corruption Commission (EACC) and the Directorate of Criminal Investigations (DCI), which are both investigating the KNTC over alleged corrupt practices in the procurement of rice, beans, cooking oil, and other essentials.

Escaped accountability

But while mid-level executives are facing repercussions, Senator Chute raised concerns that individuals in the political and business class — who are believed to have influenced the allocation of lucrative contracts — have so far escaped accountability.

The controversies trace back to a December 2022 gazette notice by the former Treasury CS Njuguna Ndung’u which allowed duty-free imports of essential food items, including 600,000 tonnes of milled rice, to alleviate food shortages and subsidise local food production.

President William Ruto’s administration intended the imports to cushion about 1.5 million Kenyans from the effects of a severe drought. The administration appointed KNTC to oversee the distribution of these supplies to stabilise market prices.

However, the Office of the Auditor-General later identified discrepancies, which exposed the sidestepping of procurement procedures, enabling certain companies associated with influential individuals to circumvent competitive bidding. Documents presented before Parliament reveal that these exclusive deals benefitted companies such as Multi Commerce FZC, which secured a contract worth Sh8.12 billion to supply vegetable oil and rice; Standard Petroleum, awarded a contract worth Sh5.5 billion for rice, beans, cooking fat, and fertiliser; Makram Imports and Export Limited awarded a contract worth Sh1.88 billion for Indian white rice; and Nutrivine, awarded a contract worth Sh187.5 million for rice supply.

Give detailed breakdown

Senator Chute has requested that CS Mvurya provide a detailed breakdown of all payments made by KNTC to suppliers, noting the amounts each company has received and any outstanding balances.

“The committee should specify the timelines for settlement of all outstanding balances,” Chute added, highlighting a need for greater fiscal discipline in government spending.

The scandal has drawn criticism from other senators, including Migori Senator Eddy Oketch, who voiced deep frustration over recurring corruption within KNTC.

“KNTC is becoming a place for serious corruption,” Senator Oketch said.

He further urged the Senate to consider establishing a commission of inquiry or special committee to thoroughly investigate the agency.

"It cannot be that people who have overseen the pilferage of over Sh1 billion, then extended to over Sh6.5 billion, remain in office," he said.