MacBooks at half a million? Audit unmasks shocking gadget deals

Auditor-General Nancy Gathungu has exposed procurement malpractices and poor financial controls at the Department of Higher Education, including the inflation of laptop and iPad costs by more than 200 per cent, resulting in a Sh2.1 million loss.

Gathungu’s report for the 2023/2024 financial year revealed that the department bought six MacBooks for Sh2.99 million instead of the expected Sh1 million, and two iPads for Sh920,000 instead of Sh720,000.

The actual price per MacBook was Sh499,320, while the budgeted amount was Sh180,000. Similarly, each iPad 4 was bought at Sh460,000, despite the initial estimate being Sh360,000.

"In the circumstances, value for money on the procurements amounting to Sh2,995,920 and Sh920,000 in respect of six (6) MacBook laptops and two (2) iPad 4 respectively, could not be confirmed," the report reads.

The Auditor-General said this went against Regulation 51(2) of the Public Finance Management Regulations, which requires that spending must align with approved budgets and procurement plans.

The report also detailed multiple breaches of procurement rules, including use of direct procurement without proper justification, irregular quotation methods, cash spending beyond limits, and non-surrender of imprests.

Gathungu pointed out that Sh2.5 million was spent on air tickets through the request for quotation method, yet only two bids were evaluated instead of the legally required three.

The department also failed to provide essential documents such as a quotation register and tender evaluation minutes.

"Further, Management did not provide the request for quotation register, tender opening minutes and evaluation minutes for audit review," the report adds.

Direct procurement was used for motor vehicle servicing, yet the service providers were single-sourced without meeting the legal requirements under Section 103(2) of the Procurement Act.

This section limits direct procurement to cases where goods or services can only be obtained from one supplier or where no reasonable alternative exists.

Cash purchases amounting to Sh100,000 were also questioned, as they exceeded the Sh50,000 threshold per item. Gathungu said these transactions were not backed by KRA electronic tax receipts or proper approvals.

"In the circumstances, Management was in breach of the law," the report states.

The department also failed to account for imprests issued to staff during the financial year, with no explanation provided for the delays in surrender.

This violated Regulation 93(5) of the Public Finance Management Regulations, which requires surrender within seven working days after returning from assignment.

"In the circumstances, Management was in breach of the law," Gathungu added.

She further raised concern over the engagement of five casual workers for a continuous period of 12 months, contrary to Section 371(b) of the Employment Act.

The department spent Sh545,091 on their wages, even though casuals should not be retained for more than three months without being given formal contracts.