Bulging in-trays await new parastatal CEOs

By Macharia Kamau

A number of State-owned corporations will in the coming weeks name new chief executives after several positions fell vacant.

The main reason for most of the vacancies is the appointment of parastatal CEOs to Principal Secretary positions. However, there are also a number of firms whose CEOs are on suspension, mainly on corruption allegations. In these cases, though, the chief executives may be reinstated if cleared of suspicion.  And then there are the companies whose chief executives will be retiring in a few weeks’ time.

 

Kenya Power

The electricity distributor will be looking for a new chief executive after Joseph Njoroge was appointed Principal Secretary in the ministry of Energy and Petroleum.

The new chief executive will find a full in-tray, with the firm now forced to find other means to raise funds to finance expansion projects after a recent directive barring the firm — and by extension the Energy Regulatory Commission — from raising power tariffs.

Kenya Power had in February sent a proposal to ERC for an upward adjustment of electricity tariffs. It had sought to raise the fixed charge and the consumption tariff by 21 per cent to cover rising costs and boost sales. The proposed rates would have seen a new fixed rate of Sh300 for domestic consumers, up from the current Sh120.

It also planned to increase the charges for new connections from Sh35,000 to Sh70,000.

However, Deputy President William Ruto last month barred any tariff increments, telling the firm to find alternative means to raise money.

The firm has also been criticised for unreliable and poor quality electricity, two factors that are said to be among the main thing that make Kenya an unattractive investment destination, and its products uncompetitive in the global market.

KenGen

The firm late last year announced that its long-serving chief executive Eddy Njoroge would retire this month.

The ministry of Energy has in the recent past said the recruitment process for Njoroge’s replacement is underway, and it would announce a new executive before the end of this month.

The firm generates electricity and sells it to Kenya Power for resale to the end users. It provides more than 80 per cent of the electricity consumed in the country.

While Kenya Power gets to deal with irate customers on the poor quality and high cost of power, KenGen is equally to blame as the power generator.

It has also been criticised for its overreliance on hydroelectricity power. When hydrodams are low on water, the company is forced to turn to diesel-powered generators, which results in a steep increase in power prices.

Diversification of power generation sources has been high on the firm’s agenda. There are plans to double the power from geothermal sources. Kenya has the potential to generate over 7,000 megawatts, but only produces 200MW.

Tea Board of Kenya

The position of chief executive fell vacant after Sicily Kariuki was appointed Principal Secretary in the ministry of Agriculture. She has held the reigns at the tea industry regulator for 10 years.

The industry has in recent years become the number one foreign exchange earner, overtaking tourism.

It, however, faces challenges including climate change that threatens to reduce production, and a farming population that is increasingly ageing, with few young people interested in the sub-sector.

Other challenges that the new chief executive will need to address include high cost of production, poor infrastructure, low level of value addition and product diversification, declining global tea prices, and inadequate research, development and extension services.

Kenya Railways Corporation

The corporation’s managing director Nduva Muli was appointed Principal Secretary in the ministry of Transport.

While he may be proud of the recently established railway service between Syokimau and Nairobi’s CBD, which reduces the trip that takes hours along Mombasa Road to minutes, the corporation has achieved much over time.

The failure to develop and sustain a robust railway network has resulted in frequent wear and tear of Kenyan roads, which have become the most viable alternative for transportation of heavy cargo.

KRC’s failures are also to blame for the intra-city traffic congestion that sees the country lose millions of man-hours in snarl ups and makes it an unattractive investment destination.

The person taking the reigns at the corporation will need to implement proposed plans that include commuter rail networks for Nairobi, Mombasa and Kisumu as well as a standard gauge railway between Mombasa and Malaba. The commuter and standard gauge rail network would ease traffic on roads and ensure faster movement of people and cargo.

Coffee Development Fund

The institution has been providing financial solutions to mainly small-holder coffee farmers.

The position of chief executive officer fell vacant after Belio Kipsang was appointed Principal Secretary in the ministry of Education.

Coffee is today not the black gold it was in the 1980s. It has slid from being a top foreign exchange earner for the country two decades ago and is today a distant fourth, after tea, tourism and flowers.

Among the challenges that the new executive will have to look into is the crop’s loss of acreage to other more lucrative industries like real estate.

National Industrial Training Authority

Nita’s director-general Patrick Omutia was appointed Principal Secretary in the ministry of Sports, Culture and Arts.

Omutia took over at Nita in November last year, and made efforts to entrench good governance within the institute. His appointment, however, raised eyebrows, with the Federation of Kenya Employers saying his selection was not transparent.

Nita is mandated to manage industrial training for public service employees. But the institution suffers a history of bad governance.

Kenyatta National Hospital

The position of chief executive at the largest referral hospital in the region fell vacant after the appointment of Richard Lesiyampe as Principal Secretary in the ministry of Environment and Natural Resources.

Lesiyampe took over as chief executive at KNH in June 2011. He was the first non-medical practitioner to head the hospital, a move that saw doctors criticise  the then Medical Services minister Anyang’ Nyong’o over his appointment.

The person who will succeed Lesiyampe has an uphill task at the hospital that is underfunded, lacks crucial equipment and medicines, still runs on systems that are largely manual and has staff disgruntled with low pay and poor working conditions.

Kenya Meat Commission

KMC’s managing commissioner Ibrahim Haji was suspended from duty towards the end of last month, pending investigations into alleged corruption at the parastatal.

The firm, which runs an abattoir at Athi River, has failed to deliver on its potential to build up the livestock sub-sector. It pays farmers late, and at the time of Haji’s suspension, it was Sh220 million in debt, most of it owed to livestock keepers who had delivered animals to KMC’s abattoir.

The institution has also been called upon to market the country’s meat products to high-paying export markets.

Kenya Pipeline Company

Selest Kilinda was suspended from his position as managing director at KPC late last month to pave way for investigations on allegations of  corruption and nepotism.

In the event that Kilinda exits KPC, whoever takes over has the task of entrenching good governance within the institution that mans crucial installations that include pipeline and petroleum storage facilities across the country.

The successor will also oversee the laying of a new pipeline between Nairobi and Mombasa. The 450km pipeline is expected to complement and eventually replace the current pipeline that has been operating the last 35 years. Studies on the old pipeline show that it would be highly risky to operate it beyond 2014.

Youth Enterprise Development Fund

Juma Mwatata Mwangala was suspended in March on allegations of corruption. The fund has been struggling with governance issues right from its inception six years ago. The fund that manages a Sh3.8 billion revolving kitty for youth-led enterprises to access cheap credit has had three board chairpersons in six years, with the high turnover indicating a probable lack of good governance structures.

The fund is thought to be among the best ideas instituted in the country to tackle youth unemployment and access to credit for young entrepreneurs. Many African countries have sent delegations to study what YEDF has got right and how it can be replicated.