In Summary
  • Kenya Power and KenGen were to pay the amount as compensation for taking over the management of Mbeere and Masinga dams, which were developed by Tarda to generate hydroelectric power.
  • The committee expressed disappointment over non-implementation of the directive and failure by Treasury to respond to earlier summonses.
  • The chairman said they would equally write to the Committee on Implementation of House Resolutions and ask to look at the matter.
  • Appearing before the PIC on Tuesday, Tarda Managing Director Stephen Githaiga said failure to honour the deal, three decades later, put the authority in dire financial troubles.

The Public Investments Committee (PIC) has summoned Treasury and Kenya Power for failing to implement a House resolution requiring them to pay a development authority more than Sh10 billion owed since 1988.

The committee chaired by Abdulswamad Nassir noted that parliament approved the 19th and 21st reports in which the PIC directed that income owed to Tana and Athi Rivers Development Authority (Tarda) by Kenya Power and KenGen be paid without further delays.

The two power utility firms were to pay the amount as compensation for taking over the management of Masinga and Kiambere dams, which were developed by Tarda to generate hydroelectric power.

“We will call  both Treasury and Kenya Power to appear before us to explain why the amount has not been paid. We want to know whether Kenya Power remitted the amount to Treasury and why Treasury had failed to pay Tarda,” said Mr Nassir.

The committee expressed disappointment over non-implementation of the directive and failure by Treasury to respond to earlier summonses.

The chairman said they would equally write to the Committee on Implementation of House Resolutions and ask to look at the matter.

“The Implementation Committee should give us a status on implementing this resolution. By failing to pay Tarda, it means Kenya Power is getting free power which it is selling to Kenyans,” Mr Nassir said.

SERIOUS TROUBLES

Appearing before the PIC on Tuesday, Tarda Managing Director Stephen Githaiga said failure to honour the deal, three decades later, put the authority in dire financial troubles.

Mr Githaiga said KenGen was to pay Tarda Sh420 million for operations but decided to pay an arbitrary figure of Sh55 million for usage of the dams.

He said Kenya Power had not yet paid any amount.

“Kenya Power and KenGen have ignored advice by Parliament, the Attorney-General and World Bank. This is despite the fact that funds were approved by parliament and set aside for this purpose,” Mr Githaiga said.

According to an audit report by Auditor-General Edward Ouko, the failure by Kenya Power and KenGen to pay Tarda occasioned a negative working capital of Sh12 billion for the authority.

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