Public Accounts Committee, lobby call for probe of KQ's loss before bailout

National Civil Society Congress (NCSC) President Morris Odhiambo (right) flanked by National Coordinator,Operation Ondoa Panya John Wamagata (centre) and NCSC Programs Coordinator Zac Momanyi during a press conference in Nairobi yesterday 02/08/2015. [PHOTO DAVID NJAAGA/STANDARD]

The National Assembly's Public Accounts Committee (PAC) has called for a lifestyle audit of all the current and former managers at Kenya Airways (KQ), following the company's Sh29.7bilion loss.

Speaking yesterday in Rarieda, Siaya, PAC Chairman Nicholas Gumbo said the committee will conduct an audit to unmask what threatens to bring down the national carrier.

Last week on Thursday, KQ announced a loss of Sh25.7 billion after tax for 12 months ending March.

"It is ironical that the company is making billions in losses yet it is among the most traded in the Nairobi Stock Exchange. Something must be wrong somewhere," said Gumbo.

The management of the firm had attributed the unprecedented loss to intense competition from Middle East carriers, volatility of exchange rates, terrorism, travel advisories and fluctuations in fuel prices.

But Gumbo said "a loss of nearly Sh30 billion is worrying and there must be something bigger than what they are telling us".

He also faulted the firm's previous audits conducted by KPMG, saying they have been misleading.

"The Government should immediately institute a forensic audit by a reputable firm to audit KPMG because all along, they have been telling us that KQ is making profits. Have they been compromised?" Posed Gumbo.

He further claimed there is a secret plot to run down major companies in the country, citing situations at Uchumi Supermarket, Mumias Sugar Company and KQs, adding that nearly all major State owned firms are fighting for survival.

"When these companies suddenly begin to make huge losses and rely on bailouts, then as a country, we are headed in the wrong direction and we need a turnaround," he stated.


He also said the Government and politicians should not dismiss the recent report released by the Auditor General detailing alleged misuse of funds at both the national and county governments.

He challenged various investigative agencies to probe why billions of the tax payers' money was not accounted for. "Politicians should not scuttle the war on corruption because the vice is now becoming a national disaster. The Auditor General just played his part and now, other constitutional bodies should dig deeper," he said.

Elsewhere, a civil society group has asked the Government to lay bare facts on what is ailing KQ before any efforts are made to rescue it.

The National Civil Society Congress (NCSC) wants the public informed on what could have occasioned the Sh29 billion loss.

According to the lobby, any efforts to rescue the national airline should not be made until the issues that have been ailing it are clear to the public and are taken care of.

At a press briefing yesterday, NCSC President Morris Odhiambo said Kenyans should not take the announcement on the KQ losses lightly, adding that the relevant authorities should take action.