Audit lifts lid on wastage, as water firms siphoned Sh47bn

Water firms owned by county governments are fast emerging as conduits of corruption amid reports that the 47 devolved units lost Sh47 billion in the last four years. 

A recent report by the Auditor-General, Nancy Gathungu, lifts the lid on extensive wastage by water companies across the country, with the firms losing in excess of Sh700 million in the 2020-21 fiscal year alone. 

Following the audit of various water firms, senators have questioned at least 14 governors and the management of the companies cited in the damning report.

The Nation has established that officials of several water firms are now on the Ethics and Anti-Corruption Commission (EACC) radar. They are accused of engaging in malpractices and embezzling of public funds.

The report, which has already been adopted by the Senate Public Investment Committee, reveals that despite water being a devolved function, water and sanitation companies in most counties remain in the hands of private entities, denying the majority of people access to affordable water.

The report shows that the water companies in collaboration with corrupt county officials have been engaging in irregularities resulting in lost revenue to the tune of Sh47 billion.

Some officials have reportedly vowed never to surrender the full ownership of water companies to the county governments as required by law. The report paints a grim picture of the water companies across the counties.

Read: Sh11.2bn lost annually to water theft, leaks

Senators have invited the anti-graft agency to carry out investigations into the operations of water firms from 2018-2023.

This comes amid concerns that some of the companies have no internal audit functions and internal audit committees, hence no proper oversight.

Some of the counties that have been flagged over malpractices are Kericho, Wajir, Garissa, Murang’a, Kitui, Nairobi, Nakuru and Taita Taveta counties.

The EACC is investigating alleged misappropriation of funds at the Kericho Water and Sanitation Company Limited.

The Auditor-General’s report for the 2020/21 financial year shows the company was operating on a negative capital of over Sh122.3 million due to misappropriation and alleged bribery.

The investigations commenced after the Senate County Public Investment and Special Funds Committee recommended the dismissal of Kibii Siele as the managing director of Kewasco early this year.

The committee accused Mr Siele of mismanagement and abuse of office to the point that the firm has been making losses over the past three years.

Read: Water crisis in Bungoma, Webuye following power disconnection over Sh14m bill

To save the water utility firm from sinking and return to profitability, Kericho Governor Dr Erick Mutai has been asked to reconstitute the board and make changes in the entire workforce.

Wajir Water and Sewerage Company Limited is on the spot for flouting employment protocols by irregularly hiring 521 workers without following due procedure.

The anti-graft agency has also initiated investigations into the possible loss of funds at Wajir Water and Sewerage Company Limited through irregular employment of over 500 staff and abuse of office.

Murang’a County is one of the counties where ownership and management of water services is in the hands of private investors.

Ownership of four out of five water and sanitation companies in Murang’a is in private hands despite the county sinking in huge investments into the infrastructure. The revenue generated does not go to the county.

The private companies reaping from county investments include; Murang’a Water and Sanitation Company; Murang’a South Water and Sanitation Company, Murang’a West Water and Sanitation Company and Gatamathi Water and Sanitation Company.

The only county-owned company is Gatanga Water and Sanitation Company.

On the other hand, Nairobi City Water and Sewerage Company cannot account for Sh39.2 million revenue pointing to the possible loss of public funds.