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Kenya Power housecleaning begins as 59 bosses suspended

By Macharia Kamau | November 5th 2021
By Macharia Kamau | November 5th 2021

Kenya Power headquarters at Parklands, Nairobi. [Edward Kiplimo,Standard]

Kenya Power yesterday suspended 59 senior procurement employees as reforms at the troubled company started in earnest.

The electricity distributor said the affected staff, all senior members of its supply chain and logistics department, had been made to step aside, pending investigations into possible procurement malpractices that have threatened the sustainability of the company while exposing Kenyans to high power bills.

The move follows recommendations by a task force appointed by President Uhuru Kenyatta in March to probe contracts between the utility firm and electricity generators.

The task force in its report fingered the procurement department as among the major problems afflicting Kenya Power.

It further recommended the replacement of the entire procurement team, with a number of them likely to face the sack, depending on the outcome of the probe.

The company said in a statement it had suspended the department’s leadership and put in place a team that will oversee procurement on an interim basis.

“As a consequence, and in compliance with the task force recommendations, Kenya Power has, with immediate effect, suspended the top leadership of the Supply Chain Division comprising 59 members of staff to pave way for the forensic audit,” said the firm.

“In the interim, the company has appointed a team in an acting capacity to ensure business continuity.”

The supply chain and logistics department is headed by Dr John Ng’eno as the general manager.

He is assisted by three departmental heads as well as numerous other senior employees at the headquarters and across the regions and counties.

The task force, which handed its report to the President on September 29, noted that procurement of different materials was among the major areas of concern at the power distributor.

It recommended an overhaul of the department, noting that it had been cited by different stakeholders as “a key problem.”

The task force proposed the replacement of all the employees in the department by deploying some of them to other areas while declaring others redundant.

“The task force report further recommended reforms within the organisation and in particular, the Supply Chain Division, which will include undertaking a forensic audit to identify areas of possible leakages so as to facilitate the implementation of remedial measures as part of the business’ reform and restructuring process,” said Kenya Power.

“The goal of the forensic audit, which will be done on the procurement systems, stock and staff, is to enhance the robustness of the company’s supply chain processes so as to anchor them on the principles of value for money, professionalism and accountability.”

Among the materials that are prone to procurement misdeeds are electricity meters, poles and transformers.

The task force found out that the company has over Sh5 billion of such and other materials stuck at its stores that are likely to go to waste. “The company is reported to be holding obsolete and slow-moving stock worth over Sh5 billion, which is likely to go to waste as in some cases, procured items are now obsolete,” said the task force in the report.

President Kenyatta in September directed the Energy Ministry to fully implement the recommendations of the task force, which might see more heads roll.

He also appointed a committee to oversee the reform process that covers not Just Kenya Power but the entire energy sector.

Among key recommendations by the task force include a 33 per cent reduction in the cost of power by end of this year as well as the renegotiation of Power Purchase Agreements (PPAs).

It is not the first time that procurement processes have caused a stir at the firm.

The allegations of procurement processes being riddled with corruption were witnessed in 2018 when nearly all of management was suspended and faced prosecution for the procurement of low-quality transformers and outsourcing construction works to non-qualified and unregistered firms. Problems in the procurement processes at the firm came to the fore in 2018 when nearly the entire top management was suspended and prosecuted for buying low-quality transformers and outsourcing construction works to non-qualified and unregistered firms. 

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