PAC forms subcommittee to probe into Kigamboni satellite city project

Dodoma. The Parliamentary Public Accounts Committee (PAC) has formed a subcommittee to look into the multibillion Kigamboni Satellite City project, which is a joint venture (JV) after the management of National Social Security Fund (NSSF) recently confirmed that the contract was fraudulently entered into.

The NSSF management appeared before the PAC, a fortnight ago and it was grilled on a number of audit queries raised by the Controller and Auditor General (CAG)’s 2014/15 report, including the project itself.

According to CAG’s report, NSSF entered the JV with Azimio Housing Estates to form a special purpose vehicle company, Hifadhi Builders Limited. Under the contract, Azimio was responsible for developing 20,000 acres in Rasi Dege, Kigamboni, where NSSF holds 45 per cent, while Azimio holds 55 per cent shares. The total estimated cost of the project was $653.44 million and the terms of capital sharing is that, NSSF will fund 45 per cent of the total project cost and Azimio will fund 35 per cent, plus the value of land, which will be regarded as 20 per cent. However, the CAG noted that only 300 acres could be counted for and advised the NSSF management to confirm from the ministry of Lands and Human Settlements Development if Azimio owned the remaining 19,700 acres in the area to avoid conflict.

The NSSF director general, Prof Godius Kahyarara, told the committee that the project stalled since February this year due to flow problems and until that time NSSF had already injected $129 million (Sh270 billion) into the project, while Azimio had injected only $5.5 million (Sh11 billion). According to him, their initial probe indicates that the actual project area was 3,503 acres instead of 20,000 acres and the price of plots massively overrated at Sh800 million per acre instead of Sh25 million.