A Sh209 million tuition complex at Sigalagala National Polytechnic has stalled with the contractor seeking to terminate the project contract amid disagreements over the rising cost of construction materials and proposed variations.

The six-storey block, whose original contract was valued at Sh195.9 million, was initially scheduled for completion in March 2024.

However, an Auditor-General’s report for the 2023/2024 financial year found that the project was only 48 per cent complete during a physical verification conducted in November 2024, seven months after the lapse of the contract period.

The matter came under scrutiny on Tuesday when the National Assembly’s Public Investments Committee on Governance and Education visited the institution to assess the status of the project and establish why it had remained incomplete.

Public Works architect Anthony Ekajul told the committee that the project had suffered delays after the contractor sought additional payments to cater for increased cost of material.

“The building has quite an immense amount of steelwork reinforcement. He requested for variation in prices,” Ekajul told the committee.

He said the original contract sum of about Sh195 million had risen to Sh209 million following a variation of approximately Sh13 million.

The architect said the structure had substantially progressed, with the foundation, superstructure and roofing completed, while windows had been installed.

However, doors, floor tiling, electrical and plumbing fittings, balustrades and external rendering were among the works still outstanding.

Ekajul said the contractor had been granted two extensions of time, with the latest projected completion date set for November 19, 2026.

But the contractor is currently off site after making claims that the project management team declined to approve.

One of the disputed claims relates to external scaffolding, for which the contractor sought an additional Sh12 million.

Ekajul said the claim had been rejected because the contractor was required to factor the cost of scaffolding into his rates when submitting the tender.

“He has to stick by that,” Ekajul said when asked whether the contractor was bound by the terms of the contract.

The contractor subsequently wrote to the institution seeking termination of the contract, prompting the project team to begin the termination process.

Sigalagala chief principal Evans Bosire said the institution had resisted demands that it considered unsupported and was determined to protect public funds.

“The contractor simply walked away, and he was forcing us to do variations. We cannot allow the government to lose,” Bosire told the committee.

Project Implementation Committee chairman Walter Obwogo said the contractor had initially sought variations for several components, including tiling, balustrades and door frames.

“We felt that we cannot manage to vary all those services because it meant that almost what is remaining is supposed to be varied,”  Obwogo said.

He said that after the contractor’s extension of time expired, he submitted a termination letter.

The committee was told that the institution had already paid approximately Sh156 million against the revised contract value of Sh209 million, leaving about Sh53 million.

Obwogo, however, said the contractor had since indicated that he was willing to return to the negotiating table.

“By next week or the other week, we are meeting together with the contractor to do project appraisal. Then from there, we know the way forward,” he said.

The revelation sparked a debate among MPs, with some calling for negotiations to save the project while others supported termination if the relationship between the institution and contractor had broken down.

Kilome MP Thaddeus Nzambia urged the institution to seek a practical solution, warning that terminating the contract and hiring another contractor could prove more expensive because construction costs had risen sharply.

“Whether you like it or not, even if you get a new contractor, you must understand that the cost of most of the materials has gone up,” Nzambia said.

He urged the parties to sit down and explore a settlement that would ensure the building is completed.

Kiminini MP Maurice Kakai Bissau also called for dialogue saying termination of a construction contract would be costly and delay the project further.

“Contract termination is very painful. Building process until you establish another contractor's benefit,” Bissau said, urging the institution to hear the contractor's side before taking a final decision.

But Embakasi MP Mark Mwenje took a different view arguing that if the contractual relationship had broken down, the institution should proceed with termination.

“If it has soured, based on my experience, that's not a contractor you can work with now,”  Mwenje said.

He warned that attempts to salvage a failed relationship through multiple variations could expose the institution to further problems.

Bomachoge Chache MP Alpha Miruka, meanwhile, cautioned the institution against unfairly shifting the burden of increased costs to the contractor while insisting that all payments must correspond to measured work.

“You cannot compare a contractor to do works at the price in 2022 to complete in 2026. That's not fair,” Miruka said.

Dick Maungu (Luanda) who chairs the committee directed the institution to engage the contractor and come up with a practical way forward within two weeks.

Maungu said the committee's responsibility was to ensure that public investments delivered value for money and that the project was completed within the law.

“What I want you to do is that you deposit that with my team, and we shall be following to see if at all they are actual, they are realistic, or they are just academic,” Maungu said.

He warned that the institution should not allow the dispute to drag on without a clear resolution.

The committee also directed management to undertake a technical, financial, contractual and legal assessment of the project, including establishing the outstanding works and the cost of completing them.

The institution said it would not approve unsupported rate adjustments, enter into a replacement contract outside procurement law or release retention money before contractual conditions were met.

The ultimate objective, management said, was to complete and operationalise the tuition block while protecting public funds.

The committee is expected to review the institution's progress after the planned engagement with the contractor.

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