National Bank fraudulently gets massive tender for new driving licences

18 Feb 2016 | by By david karani
National Bank fraudulently gets massive tender for new driving licences

Has the National Transport and Safety Authority (NTSA) issued a tender to financially crippled National Bank of Kenya (NBK) for the supply of second-generation digital driving licences?

 Sources at the NSSF-based road safety authority say that the tender was issued in April this year but NTSA is unable to go public after it was informed it had flouted basic procurement rules.

At the centre of the multi-million tender is the National Bank of Kenya which, according to documents in our possession, did not supply a bid bond as was the case with three other companies invited in the final opening of financial documents.

Despite this deliberate oversight, the authority went ahead and awarded the tender to the ailing financial institution.

NBK was the only bidder that purported to guarantee itself the financial bid instead of getting a third party.

According to procurement rules, for a document to be considered a bid bond it must possess two critical characteristics-it must be a third party bond and it must also be a surety guarantee.

“The third party issuing it must assume liability that may accrue to one of the parties to the contract”, the rules state.

But in the case of NBK, the bank pretends to guarantee itself from its own non-performance raising the question what would happen if the financial institution became insolvent.

“How is the tenderer to recover on the bid bond if those who must honour the bond are the same people who have refused to honour their contractual obligations to the tenderer in the first place?” one of the failed bidders asked.

The transport safety authority is also weary that should it make public its decision, law suits are likely to bog down the process. It is clearly caught between the rock and a hard place.

NBK was the only firm among 23 that participated in the tender that was opened on April 22, 2015 which did not have a third party financial bond.

Efforts by Gazette Weekly to get more details from the director general of NTSA Francis Meja did not materialize even after we sent him an email two weeks ago.

Calls to his office also did not elicit any reply as his secretary claimed that he was either in a meeting or out of office.

The smart digital driving licence is among new documents that NTSA had pledged to issue in 18 months after it signed a deal with  Chinese firm Huawei and Copy Cat last year. Others included new generation number plates in an effort to curb reckless driving.

The smart driving licences will allow the storage and monitoring of drivers habits and record violations through a centralised IT system hosted by NTSA.

Huawei is expected to build the mobile technology network that will allow transmission of data from the roads to the NTSA central command system.

When he signed the deal with Huawei and Copy Cat Meja said the project had started and expect five items including the launch of the smart driving licences, motor vehicle registration, fresh car inspection and new licensing regime for public transporters to be completed within 18 months.

The licences will have chips containing information such as personal identification number, contacts, past traffic offences, fines previously paid and warnings, and police officers will have devices to read the information and add charge sheets to databases as necessary. This will be backed by the new generation number plates that will be harder to replicate or forge.

The smart driving licences will support the planned demerit point system for errant drivers in which those who accumulate offences over time will be barred from driving.

Meja said that the planned system would enable law enforcement agencies reduce common traffic offences such as speeding, overlapping, dangerous overtaking and reckless driving through system monitoring of car numbers and stickers.

It will also eliminate fraud and corruption within the road transport sector.

“This module will improve information sharing between government agencies and the insurance industry and lead to effective monitoring of driving habits and record violations,” said Meja.

“This will not only enable more effective enforcement but also enable the insurance industry to calculate annual vehicle insurance premiums depending on driving records with more citations attracting higher premiums.”

However, this will not be the first time the government is considering the introduction of smart driving licenses. In 2009, the ministry of transport identified a consortium to supply second-generation driving licences.

M/S Semlex Europe SA and Compulynx Limited of Belgium were expected to begin work on the new generation cards to replace the current documents once the Finance Ministry signed the agreement. The new licences were to have chips containing information such as personal identification number, contacts, past traffic offences, fines previously paid and warnings, and police officers were to be armed with devices to read information and add charge sheets to databases as necessary but four years on, this is yet to happen.

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