State Clarifies Sh10.85 Billion Contract Variation for Talanta Stadium

The government has attributed a Sh10.85 billion difference between the original estimate and final contract value of Raila Odinga International Stadium to taxes, import duties and other charges left out of the initial project costing.

Sports Principal Secretary Elijah Mwangi said the first estimate, roughly Sh35 billion, was prepared as a concept by University of Nairobi Enterprise Services before construction was handed to a contractor.

Mwangi said that initial figure did not account for costs tied to actual contracting and construction, including VAT, withholding tax, and freight and clearing charges on imported materials.

He explained that moving from a concept estimate to a signed construction contract introduced tax obligations that had not applied when the project existed only as a design exercise.

The explanation follows scrutiny from the Auditor-General and Parliament. The Auditor-General flagged the Sh10.848 billion variation between the Sh35 billion approved by the National Treasury and the Sh45.848 billion contract value as unsupported by adequate documentation.

The audit also raised concerns about the use of direct procurement for the project and noted that Attorney-General clearance, required for contracts exceeding Sh5 billion, had not been provided for review.

The Senate subsequently sought explanations over the cost increase, the procurement process and the financial arrangements behind the stadium. Sports Cabinet Secretary Salim Mvurya had earlier attributed the increase to taxes, levies and import-related charges, prompting senators to question why those costs were absent from the original estimate.

Mwangi maintained that the gap reflected the shift from an in-house concept costing to a fully taxed construction contract. He said the government would not have incurred those tax obligations had it carried out the work itself rather than contracting it out.

Despite the government's explanation, the Auditor-General's core finding remains unresolved: that the Sh10.848 billion variation lacks adequate supporting documentation, alongside unanswered questions over the procurement method and missing Attorney-General clearance.

Raila Odinga International Stadium, formerly known as Talanta Sports City, is a 60,000-seater venue at the Jamhuri Sports Complex in Nairobi and is set to serve as one of Kenya's key venues for the 2027 Africa Cup of Nations.

Mwangi said the stadium itself is about 95 percent complete, though associated infrastructure, including a railway station and connecting roads, remains under construction.