Wednesday, November 4, 2009

All Uhuru Kenyatta is doing is transferring Government business to the family business

Many are cheering and supporting as government mandarins surrender “fuel-guzzling” motor vehicles for “cheaper” Passat cars. In his Budget speech of June 11, 2009, Finance minister Uhuru Kenyatta ordered that all ministers, assistant ministers, provincial commissioners, chief executives and all other public servants allocated cars, surrender those that exceed 1800 cc. As always, the government throws dust into our faces with such mass display of “cost-cutting” measures and we applaud.

The deadline for the said surrender was Friday, October 30, 2009 and, like all government edicts, it was never met. We are still awaiting confirmation that other than the President, Prime Minister and Vice-President, our government no longer owns Mercedes Benzes, Prados and Nissan Patrols. And we don’t mean mere removal of GK-plates and putting in place private ones. We demand full accountability.

But is this surrender of any significance? With confidence, I dare say that this policy is hot-air and of no value whatsoever. As the world reeled in economic depression and, in some instances, recession, countries singly and collectively implemented measures to correct the fall. Stimulus packages were put in place with the US leading with its domestic stimulus budgetary allocation of $787 billion.

The main objectives of stimulus plans are to save or create jobs, increase consumer confidence and to protect and attract investments. One by one, the strongest economies are climbing out of recession. France and Germany led and the US has done it this week.

In his speech, Uhuru was clear that he intended the Budget to be a “stimulus package”. If it be so, how does the use of 1.8L Passat TSi by our leading officials assist our economy? The argument of engine capacity has been touted as the main line in the Government switching to the Passat. Yet fuel efficiency isn’t all engine capacity! A vehicle is chosen for, smong others, fuel efficiency, safety, cargo capacity, its purchase price, and re-sale value.

Above all, governments are now supporting vehicles that are “green”. Developed economies are giving tax incentives and rebates to car manufacturers and researchers that are investing in the next generation green-cars. Green cars are those that are energy efficient and safe to the environment.

Such green cars are not necessarily small in engine capacity. Fuel consumption is influenced by such factors as the weight of the vehicle, its engine transmission system and level of the car technology. What will we report in Copenhagen in December? That we bought Passat because it is eco-friendly?

Further, our leaders, by virtue of their leadership, deserve a car that fits their class. All of us cannot be ministers or CEOs and those who become must have incentives to work for us. A leader’s car must be one that gives the best in refinement, elegance, safety and viability.

We cannot buy a car because it is cheaper than a Mercedes or Prado. Passat isn’t the cheapest car after all. A Mercedes Benz C-180 costs Sh5,544,000 whilst a 1.8L Passat TSi Comfortline is Sh4,295,000. Is a price difference of Sh1,249,000 going to stimulate our economy?

And, by the way, how did our Government settle on Passat and not Toyota AE100 or Vitz? The Public Procurement And Disposal Act, 2005, is very clear that all public procurements must be subjected to a transparent process. In it, transparency means that the entire world must be told what the Government wants to purchase and every one invited to bid.

A successful bidder is one who wins both in the technical specification which normally is 70 per cent pass-mark and then the pricing which is a mere 30 per cent. The only exception to this public invitation is urgency and sensitivity of the purchases. Replacing the vehicles is neither an emergency nor a state secret.

Why wasn’t the process subjected to the procurement rules? Why isn’t the Public Procurement Oversight Advisory Board annulling the purchases? Why isn’t KACC taking people to court? Or, the stones are too big to be turned? Then, who said driving a small car by our leaders will increase efficiency or reduce corruption? Inefficiency and corruption are the siamese twins of our government.

I know some of our richest civil servants driving creaky cars to avoid detection. Small cars will not stop public servants from fiddling with the IDP resettlement funds or CDF. Anglo-Leasing and Goldenberg weren’t because our leaders drove big cars.

With deference to the authors of the Passat car policy, the same is devoid of economic logic. We have not been told how much it will cost us to buy repair, service and re-sale the Passats vis-a-vis the competition. And, for sure, we will not be told how many vehicles will be surrendered, their valuations and disposals. Government operations, when it comes to assets disposal, are deliberately opaque.

Until we are told how Passat was chosen, why it and not all other motor vehicle brands, who owns CMC Motors and whether they are related to the President or Prime Minister or the Finance Minister, and whether any commissions were paid, we should let our ministers drive their Mercedes Benzes. And we cannot all be the same class. Kenya is not a communist state. Ours is a capitalist society that rewards its best and its leaders. Frugality is not always prudence.

No comments: