InsideStory: Nairobi's water infamy
They divert customer's cheques to private accounts, falsify and inflate bills, extort clients and interrupt water supplies, making access to water in the city a pipe dream writes, VICTOR BWIRE of unscrupulous water operatives
In August 2004, an employee (name withheld) of the Nairobi City Water and Sewerage Company (NWSC) based at Eastleigh meter reading station proceeded to the Kenya Cooperative Creameries offices based in Dandora. He was going to read the water meter, which he did and later established that the company owed NWSC Sh4,904,259.60.
He threatened KCC with disconnection.
However, the factory manager agreed to pay half the amount and gave him a cheque of Sh1.5 million for NWSC upon which a receipt was issued at City Hall Annex.
A second cheque of Sh1.4 million was issued on September 30, 2004 after he had returned to the factory and threatened to disconnect the water should the company delay in settling the remaining amount. And as usual, a receipt was issued to the client.
A third cheque of Sh594,746.55 was also issued by the client at City Hall and a receipt produced. All appeared to be going well and the client was about to breath a sigh of relief but little did the milk company know what was happening behind its back. After all, it had no reason to suspect foul play in the transaction, as receipts issued appeared genuine.
However, these cheques did not go to the NWSC account, they were diverted to a private account called Nairobi City Water Council Staff Self Help Group, a non-existent organisation.
Within a very short time, three signatories to the account– two men and a woman– had become Sh3.4 million richer. The three signatories were all former employees of the Nairobi City Council's water department.
Welcome to the world of Nairobi water pilferers and fraudsters. They are a cartel of politicians, former Nairobi City Council employees and some consumers who are behind the current, and possibly years and years of water shortages and inflated bills in Nairobi.
Their's is a highly complex operation that involves falsifying consumer bills, fixing illegal water connections, tempering with water meters and ensuring that cheques written in favour of NWSC are diverted to individual accounts.
Investigations by the NWSC have established that through the cartel, over 50 per cent of the total volume of treated and piped water in the city goes unaccounted for while the rest is obtained from kiosks, vendors and other illegal connections, courtesy of the network.
Unaccounted for revenue due to proliferation of illegal connections, non-metered pipes, and systems as old as 60 years that contribute to undetected leakage of treated water before it reaches its destination is also a problem in the sector.
The network also ensures that bills from the high consuming industrial enterprises, mostly based in Industrial Area are transferred to unsuspecting consumers or quashed in mysterious circumstances with the help of staff and councillors.
A case worth noting is that of constructor Ramesh Kumar Gupta. Kumar almost fell victim to a NWSC employee who used counterfeit water installation application documents to extort money from him.
In January 6, 2005, five men went to his office near Jeevanjee Gardens and introduced themselves as Nairobi water officers. Among them was an employee of NWSC attached to the Karen Water Depot. Kumar who was constructing some go-downs in Industrial Area was shown photocopied counterfeit documents purportedly from the water company.
He was told the documents were fake and that he had to part with Sh300,000 if he did not want to be arrested. Kumar then called a friend to assist him and the men vanished. Interestingly, the water company employee left a water application form for Kumar to fill.
The following day, the employee returned demanding Sh100,000 to help the businessman fill the form and have it approved. The employee was later arrested. However, that has not been the first of Kumar's tribulations at the hands of the extortionists.
While constructing additional go-downs along Dunga road in Industrial Area last year, Kumar instructed his contractor to ensure that water was connected to the building. The water was connected and the contractor gave Kumar a deposit receipt for his payment in September. The contractor also promised that Kumar would receive his first bill after three months. He has never received a bill to date.
What is puzzling is that no one knows who received the money on behalf NWSC or who connected the water and how the counterfeit documents were made.
The company admits that it has lost a lot of money through this kind of game.
Estates owned by rich industrialists and politicians, in the current and former governments and those associated with former and current councillors in the Nairobi City Council are said to have with the help of some City Hall officials, either had their water meters removed, tempered with and data removed from computers mysteriously or made to read smaller figures.
An account once held by a corporate company for her staff quarters in Eastlands and terminated in December 3, 2001 was found to have an outstanding amount of Sh8,578,209.10 at the time but usage is indicated as having existed up to December 2003.
While the estate later changed hands and is currently the property of a politician, who has leased it to the Police Department, the customer's name has not been changed at the company records though the new consumer paid an initial deposit in March 2003.
The MP's personal assistant, whose name the estate is registered in told Outlook that he could not comment on the matter without permission from the politician.
"There are a lot of things involved in that transaction that I cannot divulge to the press without authority from my boss," he said on phone. Efforts to get the MP were fruitless. He was said to be up country when we were going to press.
A perusal of the meter card indicates that the meter was last read in April 15, 2003. It is interesting that the billing is indicated even when the premises were not occupied.
Why did the person charged with the responsibility of reading this particular meter cause the company to lose revenue?
And to cap it all, although water is flowing and the meter box is intact, there is no meter and it is not known when the meter was taken. Efforts to get the current consumer pay an estimated figure covering April 2003 to date have been fruitless.
In the water scam, there are also cases of strangers and former dismissed staff who impersonate company employees and collect money from unsuspecting customers and also harass those who refuse to pay. This is done in collusion with company staff.
The unequal water distribution has seen a situation where out of the three million residents, about 40 per cent receive water on a 24 hour basis, 30 per cent only once in two days and about 10 per cent once every two weeks.
It is estimated that the potential number of customers is 450,000, but currently only 186,000 are metered.
In the short term, additional meters are required to replace non-functional ones, and an installation of others for new customers covering new premises, illegal connections and flat rate customers is necessary.
Illegal connections that have caused the current unequal distribution of water in the city is a scheme also operated by powerful individuals. The worst hit areas are Jericho, South C and Umoja.
Umoja's illegal connection and water vending business is operated by a former mayor and involves diverting water from the main pipe to tankers at night, and later sold to residents. This pipe also serves Jomo Kenyatta International Airport.
Efforts to get the Umoja culprit arrested are under way.
In areas such as Pipeline, Industrial Area, Parklands, Kasarani and Ngong Road, residents are denied water by some known barons. In South C, Reality Estate, a house owned by an MP is a hub for illegal water connections and water vending business. Currently, his agent is at Kamkunji Police Station awaiting to be taken to court by NWSC.
And only six months after the NWSC was established, it is emerging that the cartel, also involving former employees of the Nairobi City Council's Water and Sewerage Department now want the company board dissolved.
Relations among board members have deteriorated to such an extent that members in the warring camps in the board rarely see eye to eye.
In a stormy board meeting held in December, some members led by representatives from the City Council wanted current board chairman, Kabando wa Kabando, replaced by his deputy T G Ruhiu, who represents the National Chamber of Commerce and Industry.
Sources who attended the meeting told Outlook that councillors were opposed to the Code of Ethics that the Board introduced, which bars members from doing business with the company. Kabando, who is also chief executive of the Kenya Association of Hotel Keepers and Caterers survived the onslaught .
As the board wars continue, investigations also established that company staff, especially some inherited from Nairobi City Council handling meter verification issues, deliberately ignore reading meter cards on being paid corruptly by some customers.
Contacted, the chairman of the Nairobi Water Services Board, Mr Patrick Kinyori admits that his board is aware that some senior personalities in the government, councillors, rich industrialists suppliers and former council employees are behind the current water woes in the City.
"We are aware that some crooks who have tried to infiltrate and cause the current unequal water distribution and given mysterious bills to unsuspecting customers on having their efforts repulsed have turned to all manner of threats to members of the board," Kinyori says.
Kinyori says his board on establishing that there are massive irregularities in billing and on revenue collection by the new company, all problems inherited from the Nairobi City Council, launched investigations, which have unearthed massive fraud, led by the cartel and employees in the former NCC Water and Sewerage department.
"We have established that a substantial amount of revenue gets lost through illegal water connections, faulted meters and diversion of money meant for the company. All those implicated in the scam will be arraigned in court soon, irrespective of their position in the country," he says.
On the current Sh11 billion owed to the company by various bodies including government departments, Kabando says collecting the money has been slow because streamlining the bills has been difficult. Though, monthly collections have increased from Sh100 million six months ago to the current Sh150 million.
"Investigations have also established that it is mostly the poor who pay for water in Nairobi while the rich enjoy free services. The irregularities are massive and I must admit that we need external help in terms of forensic experts to reach the root of the problem," he says.
Others to be targeted will be former suppliers who sold the former council wrong water treatment chemicals–chalk instead of chlorine–and verification of outstanding bills.
"While officially water costs Sh12 per 100 litres, the poor, especially living in the informal settlements like Kibera and Mukuru pay 20 times more, because of well-connected, wealthy illegal vendors. Ruai is a notorious zone too," Kabando says.
He adds that the lethargic culture among workers has created inertia, as organisational change and development may not always move in tandem with some of the employees.
NWC Managing Director, Mr Francis Mugo, says that the fight to improve water services in Nairobi has been complicated by the backlog in billing, incorrect water bills, non-functional meters, poor customer relations, a lazy work culture by employees inherited from Nairobi City Council and corruption.
"The company recognises that the current water supply is still below the demand for water in Nairobi and the problems associated with water in Nairobi are complex. We have experienced serious problems with inaccurate bills while trying to shift the billing software from the former City Council's water department but things are gradually improving," he says.
To clear the backlog, the company currently produces 8,000 bills a day and aims to increase the production to 10,000 bills per day, soon.
The cartel has used tricks provided by the current situation where the water billing is carried out through the main council computer system, which has proved woefully inadequate.
The company has already approached the office of the President, through the Ministry of National Security to help it have the culprits arrested and prosecuted.
Because the computer software currently containing data on old bills was crushed, forensic experts will be called in to help retrace the bills.
To be targeted will be real estate construction firms and industrial plants, which have for several years operated without paying bills. Others include politicians who have been diverting water for farm use at no cost.
