EACC has issued a Circular to all Governors requiring them to take urgent reform measures pursuant to their constitutional responsibility as Chief Executive Officers under Article 179(4) of the Constitution, to tame the corrupt practices identified by the Auditor General in the management of water and sanitation companies across the country.
The Auditor General’s Reports are under consideration by the Senate County Public Investments and Special Funds Committee.
Highlights of the identified malpractices:
i) Some of the water companies have never been transited from local authorities to the county governments. E.g. 4 out of 5 water and sanitation companies in Murang’a County are under the control of private persons despite these being county investments.
ii) High percentages of Non-Revenue Water (NRW), some as high as 82% above the allowable ratio of less than 25% as per the Water Service Regulatory Board (WASREB) Guidelines resulting in loss of revenue. E.g. Wajir Water and Sewerage Company has the highest at 82%.
iii) Embezzlement of statutory deductions payable to KRA, NSSF, NHIF, and Staff Pensions as well as customers’ meter deposits leading to huge amounts of long outstanding pending bills. As a result, many retired employees cannot access their pension dues.
iv) Blatant disregard of public procurement laws and regulations resulting in loss of public funds through collusion, overpricing of goods and services, award of contracts to unqualified firms, and conflict of interest.
v) Weak and ineffective enforcement mechanisms leading to huge amounts of uncollectable receivables from water sales.
vi) Un-procedural debtors’ write-offs without approval by the County Assemblies as required by law.
EACC says the Circular to Governors is a preventive measure as investigations continue.
“As the Chief Executive Officers of the County Government in line with Article 179 (4) of the Constitution, and in collaboration with your Managing Directors of Water Companies, you are required to put in place systems and procedures to streamline integrity, transparency and accountability to address the above malpractices.” The statement to Governors by Twalib Mbarak read.
Further, EACC says Gov’ are required to put in place procedures for Prevention of Bribery and Corruption in these Companies as required by Section 9 of the Bribery Act, 2016 and Regulation
13 of the Bribery Regulations, 2022.
“This is to be done in line with other relevant provisions of the Constitution; Public Finance Management Act, 2012; Public Finance Management (County Government) Regulations, 2015; and among other relevant laws including County Government Legislations.”
“The Commission requires you to submit a Mitigation Plan for addressing the above malpractices and thereafter provide quarterly implementation progress reports for review and monitoring by the Commission effective from the first quarter of 2023/2024 financial year. Please be advised accordingly.”
