Twenty days before her ouster as Managing Director of the Kenya Ports Authority (KPA), Catherine Wairi picked a quarrel with the Kenya Railways by firing a scathing demand letter to the railway’s top brass.
On May 2, she wrote to KR Managing Director Atanas Maina demanding payment of Sh930,528,000 for labour and equipment used by the railways to load and ferry cargo on the Standard Gauge Railway (SGR) freight service.
Incidentally, Mr Maina is a director in the board that sacked Mrs Wairi in a night meeting on May 30 although he did not attend (the board) meeting that day.
Her sacking is now a matter of two court suits and one of the points pleaded in them is that the engineer who attended the board meeting was not eligible to do so and vote.
It is unclear why Mrs Wairi chose the avenue of writing to demand the money or if she had tried other means, including asking the Transport Ministry to compel KR to pay its debt. But this demand exemplifies the complex and frosty relationship between KPA and KR following the introduction of the freight service.
In the May 2 letter, Mrs Wairi says, “The purpose of this letter is to request you to remit Sh930,528,000 being the charge for hire of labour and equipment from January 2018 to March 2018.”
She appears anxious to remind the KR boss that KPA had supported the SGR freight service, including by construction of port relief lines to the launch of the service in January and its operation.
“KPA has also reviewed its tariffs with the objective of encouraging customers to use the SGR,” she writes, adding that at the launch of the freight service KR was expected to handle cargo at the marshaling yard through an appointed operator.
Apparently, KR did not appoint the operator or live to its other obligations. Instead, KPA seconded its employees and equipment to the disposal of KR under a financial agreement with the expectation KR would pay back.
Friday, KPA acting Managing Director Daniel Manduku reacted to the reports, saying both KPA and KR are government agencies and the issue of who owes who should not arise.
“We have our own mechanisms on payments. We work for KR or even the Kenya National Highway Authorities (Kenha). It is thus not an issue,” said Dr Manduku.
He said the money in question belongs to the National Treasury and it does not matter whether it is in the right or left pocket.
According to the letter, KR did not pay this money from January to March and it has accumulated to the equivalent of Sh5,184,000 for supervisory staff KPA seconded to the freight service, Sh8,640,000 for clerks, Sh5,184,000 for dockers and Sh4,320,000 for serangs.
The letter indicates that KPA deployed reach stackers and terminal tractors to KR in aid of the freight service for which Sh259,200,000 and Sh648,000,000 remained unpaid by KR, respectively, at the start of May.
Officially, Mrs Wairi’s sacking was put down to incompetence and failure to decongest the port’s container depot. In the days leading to her ouster, the Kenya Revenue Authority’s IT clearing systems also collapsed, making it impossible to move any import cargo from the port.
Reports indicate KPA and KR, which runs SGR trains, have not been working in concert to achieve the same goals since the launch of the freight service early this year.
Other reports indicate the two parastatals have differed over the management of an alleged escrow account created to bank money raised from the SGR freight services to pay the loan borrowed from the Chinese to build the railway.
This revelation comes at a time when Manduku’s two-month tenure as acting MD comes to an end, and on the back of a July 5 decision by the High Court in Mombasa to allow the Ethics and Anti-Corruption Commission (EACC) to investigate how a private firm acquired a prime piece of property belonging to KPA.
Following her ouster Mrs Wairi reportedly claimed she was being frustrated or sabotaged by other state agencies also operating within the port.