A parliamentary committee has reopened scrutiny of a multi-million-shilling hostel project at Jaramogi Oginga Odinga University of Science and Technology (JOOUST), ordering fresh investigations after auditors flagged unexplained cost increases, unsupported contract changes and an unresolved legal dispute with the contractor.
The National Assembly's Public Investments Committee (PIC) on Governance and Education directed former Vice-Chancellor Stephen Gaya Agong, project consultants and auditors to appear before it and account for how the cost of the 1,000-bed hostel rose from the original contract value to Sh844.1 million.
The directive was issued during a committee session chaired by Dick Maungu on July 9, 2026, after lawmakers examined audit reports that questioned whether procurement rules were followed throughout the implementation of the project.
Construction of the hostel began after Sasah General Merchants won the tender in February 2010 at a contract price of Sh663.9 million. The project was expected to take three years but certified payments later climbed to Sh844.1 million.
Audit reports for the 2023/24 and 2024/25 financial years showed that the university did not provide records to support contract variations worth Sh180.1 million. Auditors also established that completion and handover certificates were missing despite students already occupying the hostel.
The committee also heard that the contractor has taken the university to court through Civil Case No. E002 of 2023 over alleged unpaid dues, a move that could expose taxpayers to additional financial obligations if the case is successful.
Representing the Office of the Auditor-General's Kisumu Regional Office, CPA Kennedy Ongoi warned that poor management of public projects often leads to avoidable losses through court cases.
“Where a contractor takes a public institution to court demanding payment, the institution risks paying legal fees and penalties. These are avoidable expenses if projects are managed prudently,” Ongoi said.
Agong, who left office as Vice-Chancellor on June 19, 2023, told the committee that the university had paid close to Sh600 million during his time in office. He maintained that the final payment certificate under his watch reflected only Sh4.8 million.
His explanation was challenged by committee chairperson Dick Maungu, who pointed to Certificate Number Five dated June 9, 2023, showing cumulative certified payments of about Sh844 million before Agong's departure.
“You exited the university on June 19, 2023, and before you left, Certificate Number Five had already been prepared showing Ksh844 million. Meaning all this happened within your tenure,” Maungu said.
Committee documents further showed that the project received several additional payments, including Sh19.8 million, Sh38.1 million, Sh44.1 million, Sh528,000 and another Sh79.6 million listed as fluctuations.
Maungu questioned whether those extra payments complied with the Public Procurement and Asset Disposal Act.
“There is something unique called fluctuations amounting to Ksh79.6 million. We need to understand where this falls under procurement law because fluctuations and variations are different,” he said.
Agong denied approving the disputed Sh79.6 million, saying it did not form part of the final accounts he signed. He told the committee that some of the spending could have gone towards maintenance after students occupied the hostel, including repairs following a fire incident.
He also defended the decision to retain the original contractor for maintenance work, arguing that changing contractors while the hostel was occupied would not have been practical.
Despite those explanations, lawmakers remained dissatisfied and resolved to summon all key players involved in the project as investigations continue into how the additional public funds were approved and spent.