Mastery of Grafting at Kenya Power
With a new administration, it seems to me that we are going to learn some big lessons about the impact of a change of government on policy-making in the electricity sector. For what shapes policy-making in this sector is not just political will. These are inter-elite relations and informal power games. With regime change, some of the pertinent questions that arise are:
Will the new administration of President William Ruto maintain the momentum of the fight against corruption and the reform of Kenya Power which began in earnest almost a year ago with the launch of thorough forensic audits on business-critical operations and systems?
Will Kenya Power succeed in completing the international tender for the purchase of quality, world-class transformers, meters and cables that has been going on for months – and where the company has been forced to fight a long rearguard battle with a group of politically influential local suppliers?
They are powerful local entrepreneurs who, through an official cartel known as the Energy Suppliers Association, have dominated the supply of critical inputs for 10 years. The stakes in the current dispute are indeed high as what is on the table is a massive procurement process worth an estimated 5 billion shillings.
Weeks before President Ruto’s inauguration, well-known ruling party supporters took to social media to warn the company not to proceed with awarding the coveted and lucrative contract until the new government is sworn in.
From what I understand, the procurement process is in advanced stages and initial agreements have been reached. But insiders told me this week that management had come under intense pressure to stop the process. Kenya Power engineers will be the first to tell you that the company has the fourth highest transformer failure rate in the world.
To get to the bottom of Kenya Power’s problem, the game-changer has to be the long-awaited results of forensic audits of the company’s operations and systems. On Wednesday, I reached out to Auditor General Nancy Gathungu to find out why forensic checks still haven’t been completed nearly six months later. I informed her that I wanted to know the outcome of the audits as the revelations are going to be key to the war on corruption and Kenya Power’s return to a healthy balance sheet. She replied that she was unable to comment on the matter as the audits had not yet been completed.
As taxpayers, we all need to start pressuring the Auditor General to release the results of forensic audits and insist that all audit findings be made public.
We need to know why the company kept billions of shillings in obsolete inventory and if it got its money’s worth from purchased goods. We want to see the full findings and results of the in-depth investigation and forensic audit into the heavy fuel oil supply.
A detailed forensic audit of legal agreements with Independent Power Producers (IPPs) will also be essential. How do the terms and conditions under which we contract IPPs compare to similar contracts in the rest of the world? Is it true that we have the fourth highest number of transformer failures in the world? Why do incidents where electric poles fall and kill innocent people become frequent? Does the company buy good quality poles? Ms. Gathungu must provide answers.
Another important outstanding issue is the hiring of a substantial CEO. Last year, the board set very high standards by advertising the position in the international media. From what I understand, the recruitment process ended with the selection of three names which were then given to the Ministry of Energy for nomination. The ministry declined to act on the names because all three names were foreigners.
Is it any surprise that the Ministry of Energy found the prospect of a foreign CEO of Kenya Power distasteful?
Anti-expatriate sentiment not only smacks of vicious parochialism, but can end up hurting the interests of our nationals seeking jobs in international markets.
The writer is the former editor of East Africa newspaper.