•Concerns follow a probe by Senate on alleged grand corruption at the water companies.
•Mbarak pointed out lack of policies on management of assets and liabilities, risk management and fraud prevention mechanisms.
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The Ethics and Anti-Corruption Commission has put governors on notice over rampant corruption at water companies under their purview giving the county chiefs a 90-day ultimatum to devise a mitigation plan.
The anti-graft agency says the water companies are wrought with cases of bribery and other forms of corruption among other malpractices – some said to be to the benefit of unscrupulous county chiefs.
EACC chief executive Twalib Mbarak in a circular to all governors, following an intervention by Senate oversight committees, singled out 10 malpractices that are commonplace in the entities.
The anti-graft agency boss said “in the exercise of its preventive mandate” discovered extensive malpractices in the management of water and sanitation companies.
He cited rampant cases of embezzlement of statutory deductions and customers’ meter deposits.
Mbarak said this has resulted to huge amounts of outstanding pending bills presently chocking most of the companies, adding that there were many cases of irregular payment of directors’ emoluments without any supporting documents.
EACC further says governors have allowed irregular recruitment of staff without involving the county public service boards as required by the law.
Mbarak pointed out lack of policies on management of assets and liabilities, risk management and fraud prevention mechanisms.
A recent audit by Auditor General Nancy Gathungu revealed that water companies across the country lost in excess of Sh700 million in 2020-21 fiscal year.
Following the audits, senators have been questioning 14 governors and the management of companies that were cited in the damning report.
The Kitui government is among those on the spot for injecting close to Sh1 billion into a nearly insolvent water company whose ownership was unclear.
State House deputy Chief of Staff Josphat Nanok also faces Senate summons to explain the ownership of Lodwar Water and Sanitation Company.
There is an alleged 40 per cent shareholding in the company by private individuals through a private firm- Turkana Outsourcing Company.
The Senate’s County Public Investments and Special Funds committee chaired by Vihiga Senator Godfrey Osotsi has also instructed Murang’a county to reconstitute boards of some four water firms.
The said companies have reportedly pledged never to surrender their full ownership to the county as required by law.
MPs have also invited EACC to carry out investigations into the operations of Wajir Water and Sewerage Company from 2018 to 2020.
It is the probes that have prompted the circular by the anti-graft agency.
This is also amid concerns some of the companies were running without internal audit functions and internal audit committees, hence had no proper oversight.
The EACC boss further cited failure by the entities to comply with public procurement laws and regulations.
He added that illegal connections, water theft, bribery and corruption were to explain for the high percentages of non-revenue water – some as high as 60 per cent above the allowed 25 per cent – reported by the companies.
Mbarak said the entities’ weak and ineffective enforcement has exposed them to huge amounts of long outstanding debts “as a result of corrupt practices.”
EACC adds there were instances of unprocedural debt write-off without approval by the county assemblies resulting to loss of public funds.
He thus directed governors, as chief executive officers of the county government, to “put in place systems and procedures to streamline integrity, transparency, and accountability to address the cited malpractices.”
“The commission requires you to submit a mitigation plan for addressing the malpractices and thereafter provide quarterly implementation progress reports for review and monitoring by the commission effective from the first quarters of 2023-24 financial year,” Mbarak said in the June 22 circular.
Governors are further required to devise procedures for prevention of bribery and corruption in the said companies.
“This is to be done in line with other relevant provisions of the Constitution, Public Finance Management Act 2012, PFM (County Government) Regulations, 2015, and among other relevant laws including county government legislations,” the EACC chief said.
The circular is copied to Water and Sanitation Principal Secretary Paul Ronoh, chairperson Senate Committee on Public Investments and Special Funds and Senate CPAC chairperson Moses Kajwang’.