- Mbarak said graft malpractices have led to losses and insolvency of some of the water and sanitation companies.
- Among them is embezzlement of statutory deductions and customers' meter deposits resulting to huge amounts of long outstanding pending bills.
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The Ethics and Anti-Corruption Commission Chief Executive Officer Twalib Mbarak has called on governors to look into graft malpractices in water and sanitation companies in counties.
Mbarak said graft malpractices have led to losses and insolvency of some of the water and sanitation companies.
"In exercise of its preventive mandate, the commission has noted extensive malpractices in te management of Water and Sanitation companies," Mbarak said.
He said the water and sanitation firms are county government investments charged with the responsibility of production and distribution of clean and safe drinking water.
The companies are financed through revenue collected from water sales, other services and grants from respective county governments.
Among the malpractices observed by the EACC is embezzlement of statutory deductions and customers' meter deposits resulting to huge amounts of long outstanding pending bills.
Mbarak also note that there are irregular payments of directors' emoluments without supporting documents contrary to Regulation 104 (1) of the Public Finance Management Regulations (County Government), 2015.
"The commission has also observed irregular recruitment of staff without involving the County Public Service Boards contrary to section 63 of the County Government Act, 2012," Mbarak said.
He said there is also a lack of Asset and Liability Management Policy contrary to Section 132 (3) of the Public Finance Management Regulations (County Government), 2015.
Mbarak added that there is also lack of Risk Management Policy and Fraud Prevention Mechanisms for the water and sanitation companies.
Additionally, he said there is lack of oversight mechanisms such as Internal Audit functions and Internal Audit Committees.
The EACC boss also noted failure to comply with public procurement laws and regulations.
Mbarak said there are also high percentages of Non-Revenue Water (NRW), some as high as 60 per cent above the allowable NRW ratio of less than 25 per cent as per the Water Service Regulatory Board (WASREB) guidelines.
"This is attributable to illegal connections, water theft, bribery and corruption," he said.
Mbarak said the EACCC has also noted a weak and ineffective enforcement leading to huge amounts of long outstanding uncollectable receivables as a result of corrupt practices.
"We have also observed that there is unprocedural debtors' write offs without approval by the county assemblies as per the Public Finance Management Regulations 141 (1) to (8) (County Government) 2015; resulting to loss of public funds," he said.
Mbarak urged all governors to collaborate with the managing directors of Water companies to put in place systems and procedures to streamline integrity, transparency and accountability to address the malpractices.
"Further, you 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," Mbarak told governors.
He said EACC will require governors 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 quarter of 2023/2024 financial year.
"Please be advised accordingly," Mbarak said.