The Kenya Revenue Authority (KRA) is unable to explain how a company that was hired for a six month contract to conduct Psychometric Testing of the tax collectors ended up having one of its directors as the authority’s Human Resources technical manager between 2008 and 2014.
This even as it emerged that the taxman outsourced its payroll management service for 32 top managers to consultancy firm Deloitte and Touche for 18 years.
The National Assembly’s Public Investments Committee on Commercial and Energy Affairs heard that the KRA entered into a contract with Working Smart Skills Limited on four different occasions from 2008 to 2014.
The taxman engaged the Working Smart Skills Limited for a period of six months in 2008 but the contracts were subsequently extended after the expiry until 2014.
KRA hired Njoki Muhoho, a director of Working Smart Skills Limited as a technical manager for Human Resources without providing evidence that the process was competitively done.
The committee chaired by Pokot South MP David Pkosing put acting KRA Commissioner General Rispah Simiyu to task to explain how a six month contract for carrying out online Aptitude Test Services for graduate trainees’ recruitment and establishment of a Psychometric Centre transitioned into the hiring of Ms Muhoho.
“How did a contract awarded to Working Smart Skills Limited for Aptitude Test change into a full time appointment of a human resources expert for KRA?” Mr Pkosing asked.
A report of Auditor-General Nancy Gathungu shows that the KRA engaged Working Smart Limited, a company whose registration and existence could not be established at the time of audit.
She said the authority stopped engaging Working Smart Ltd as an entity and chose to engage one of the directors to set up a Psychometric Assessment Centre (PAC) and implement a mentoring programme.
The director was contracted as a technical manager as per a letter dated September 10, 2008 for six months at the rate of Sh225,000 per month, a position which did not exist in the KRA establishment then.
On August 8, 2008, technical manager operating as a human resource consultant was contracted to perform a Psychometric Test to 159 clerical staff and 51 office assistants, test analysis and present a report at a cost of Sh250,000 after out competing other human resource recruiting firms, one of which quoted Sh482,560 for the service and another whose quote was not disclosed.
Ms Gathungu said on March 10, 2009, the technical manager initial contract of September 1, 2008 was extended for three months at Sh225,000 per month.
On January 25, 2010, a proposal was made to pay the technical manager for four months from August 4, 2009 to November 4, 2009 for a task without specific deliverables at the rate of Sh225,000 per month.
“In a letter dated January 25, 2010, the technical manager was reappointed for another four months at the rate of Sh225,000 still without specific deliverables,” Ms Gathungu said.
She said the contract was again extended on June 9, 20210 for another four months.
The authority engaged the technical manager to carry out a Psychometric Test for Senior Deputy Commissioners for Sh272,000
On January 27, 2015, the taxman engaged the technical manager now as a Human Resource Expert to support the human resource division in delivering key assignments at Sh25,000 per day for six months with effect from February 1, 2015.
The Human Resource Expert was again on February 1, 2015 engaged to undertake a psychometric testing at Sh15,000 per person, the cost which would include administration of the tests, report preparation and feedback.
“Based on the above analysis, the Human Resource Expert was engaged as an individual and not as Working Smart Ltd and all payments advice issued to the expert,” Ms Gathungu said.
“Under the circumstances, the consultancy services was single sourced and the contract between KRA and the Human Resource Expert is irregular and has resulted in a payment of Sh6.74 million.”
“I request for more time to revisit this matter. I need to check the documentation on how the Working Smart contract changed to Ms Muhoho as an individual,” she said.
The committee also took issue with the contract between KRA and Deloitte and Touche to offer payroll services through their Business Services Department Company, Livingstone Registrars Limited.
The payroll service was to process salaries and remuneration for 32 top management staff at an annual charge of Sh7, 500 and Routine Charges of Sh405,000
The contract was later changed to an annual charge of Sh7,500 and a routine charge of Sh513,000 annually.
“Why would a government entity entrust the salaries and compensation of its 32 senior staff to a private firm?" Mr Pkosing asked.
