Sh11bn unaccounted for in Talanta Stadium project
Office of the Auditor-General has uncovered major financial irregularities in the Talanta Sports City project, revealing that Sh10.85 billion of public funds cannot be properly accounted for.
The Office of the Auditor-General has uncovered major financial irregularities in the Talanta Sports City project, revealing that Sh10.85 billion of public funds cannot be properly accounted for.
According to Auditor-General Nancy Gathungu, the cost of constructing Nairobi’s 60,000-seater stadium has increased from the Treasury-approved Sh35 billion to Sh45.85 billion without lawful explanation, raising concerns over transparency, procurement processes, and financial oversight.
The audit, covering the Ministry of Defence’s accounts for the 2024/25 financial year, shows that the original Sh35 billion approved by the National Treasury was to be drawn from the Sports and Arts Social Development Fund (SASDF) over six years.
However, the Ministry of Defence signed a two-year contract with a foreign contractor on May 26, 2024, for Sh45,848,051,675 (US$344,514,966), resulting in an unsupported price variation of Sh10.85 billion.
The report also notes that clearance from the Attorney General, then Justin Muturi, was not sought before awarding the contract, in violation of Section 134 of the Public Procurement and Asset Disposal Act. Contracts exceeding Sh5 billion require AG clearance and regular reporting to the Cabinet and National Treasury.
Additionally, the Ministry of Sports, Culture and Social Services transferred Sh2.01 billion and procurement responsibility to the Ministry of Defence before the contract was signed.
The contract was awarded via direct procurement, a method reserved for exceptional circumstances, instead of through competitive open tendering as mandated by law.
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Project reports indicate 44.54 per cent completion as of June 1, 2025, with 15 months remaining to meet the expected contract timeline.
Cumulative payments to the contractor amount to Sh2 billion, roughly 4.5 per cent of the total contract sum. The audit warns that late payments could attract interest at three per cent above the Central Bank of Kenya’s average base lending rate, potentially increasing project costs.
The Auditor-General also expressed concerns about the project’s financial model, noting that full details have not been provided.
“The contractor signed a consent agreeing to transfer duties and obligations of subsequent payments to the Trustee on behalf of the Ministry of Defence.
However, full details of the new funding model have not been provided, hence the need for a special audit to determine value for money,” the report states.
The Talanta Sports City stadium is scheduled to host matches for the 2027 Africa Cup of Nations, making transparency and oversight critical ahead of the tournament.
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