Problems for RVR and Kenya Railways

[John Ashworth]

Kimunya and Mwakwere face probe over RVR deal


By PETER LEFTIE
Posted Monday, August 31 2009 at 22:30
Nation

In Summary

* Treasury PS also listed alongside other officials to be investigated

Two Cabinet ministers may find themselves on the receiving end of investigators if recommendations by a parliamentary committee are implemented.

Trade minister Amos Kimunya and his Transport counterpart Chirau Ali Mwakwere are among officials whose roles in the concessioning of the Kenya Railways Corporation have raised more questions than answers, and who face an investigation by the Kenya Anti-Corruption Commission.

This is the second time unlucky for Mr Kimunya, who was put on the spot by another parliamentary committee over the controversial sale of the Grand Regency Hotel (renamed Laico Regency).

The Public Investments Committee has asked the Parliamentary Committee on Implementation to follow up on recommendations that KACC opens investigations into the roles Mr Kimunya and Mr Mwakwere played in awarding Rift Valley Railways the concession to manage the Kenya-Uganda railway network.

The report also recommends that KACC, in addition to the two ministers, should investigate Treasury permanent secretary Joseph Kinyua and Investments secretary Esther Koimett for their role in the concession.

It further recommends the immediate termination of the contract and that the operations be reverted to the Kenya Railways Corporation.

PIC chairman Mithuka Lintuli on Monday told the Nation his committee had forwarded its recommendations to the implementation committee to ensure that they were acted upon.

Committee member David Were (Matungu MP) hoped that PIC’s recommendations would be “taken seriously”.

“Since Parliament has adopted the report, we are hoping that our recommendations will be acted upon by the relevant bodies, including the Treasury where the matter originated, and the implementation committee,” he said.


Railways boss probed over losses

By ALPHONCE SHIUNDU
Posted Thursday, September 3 2009 at 22:30
Nation

In Summary

* House team queries parastatal’s financial health in the wake of two damning reports

Three Kenya Railways Corporation managers were on Thursday put on the spot by a Parliamentary team over the parastatal’s shaky financial grounding.

Managing Director Nduva Muli, his deputy Vitalis Ong’ong’o and the General Manager (Finance) Lucas Wambati were questioned by the Public Investments Committee over the poor performance of the firm for the four years between 2004 and 2007.

The committee, led by Hon Yusuf Chanzu, followed up on questions raised by the Assistant Director of Audit, Mr J J Otieno, over the firm’s flawed handling of financial processes.

It demanded proof that the corporation was not broke and “technically insolvent” as described by the Controller and Auditor General.

But Mr Muli said the parastatal had made huge strides towards financial recovery, and that it had already recouped some Sh204 million out of the Sh7 billion owed to it by creditors.

However, he said, some of its debts may never be recovered because of poor record keeping in the past, which has consequently led to the expiry of the legal six-year period within which to claim debts.

Mr Muli also said the failure by Rift Valley Railways to pay its concession fees to the parastatal had gravely affected the corporation’s financial health, but forecast a Sh800 million operating profit at the end of this year despite the unfavourable business environment.

Terminate concession

He said Transport minister Chirau Ali Mwakwere had asked the corporation to “indulge” RVR on the termination of the concession, which has been scandalised by both the PIC and Parliament in the recent past.

The MD defended the planned selling of the corporation’s assests, saying only “non-strategic” property would be sold to clear debts owed to staff. The parastatal has already paid out Sh100 million of its Sh500 million debt to Reli Sacco.