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All parastatals to be audited by govt not private firms

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National Assembly Speaker Justin Muturi

National Assembly Speaker Justin Muturi

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National Assembly Speaker Justin Muturi has faulted the move by Auditor General Nancy Gathungu to seek private firms to audit Kenya Power.

Muturi questioned why private audit firms have always given the parastatals a clean bill of health at a time when the cost of electricity was skyrocketing.

He said that private auditors were always returning ‘clean’ accounts for State agencies despite outstanding audit queries and procurement irregularities.

“They need to tell us why Kenya Power is audited by private firms. When I was Chair of the Public Investment Committee (PIC) I recommended that Kenya Power be audited by the Auditor-General. This is because when the Auditor General issues a report, there is always a ripple effect,” said Muturi.

He called upon the house in its oversight role to question why firms that the government has an interest in always run to private entities when it comes to audits.

“Kenya Power has become a thorn in this country due to the high cost of electricity which chases investors away. I think it is time, when we must ask ourselves, are our professionals doing the right thing?” Muturi posed.

In June this year, Parliament directed the Auditor-General to order all parastatals under the Ministry of Energy including Kenya Power and KenGen to stop hiring private firms to do the audit.

The Public Investment Committee raised issues with the move by the State corporations under the Energy docket continue to advertise for external audit services, saying it was in breach of the Constitution, the Public Audit Act, and the Public Finance Management Act

The law allows the Auditor-General to outsource audit services after entering into contracts with private audit firms.

The parastatals however have been sourcing for private audit firms on their own.

This unfolds at a time when Kenya Power has been declared a special government project, following a recent report presented to President Uhuru Kenyatta by a special task force.

Last week, Interior Cabinet Secretary Fred Matiangi said an inter-ministerial committee had been formed to conduct a fresh audit on Kenya Power’s supply-demand needs and pricing policies.

“We are going to do a forensic audit of some of our systems and procedures. We are working jointly at an inter-ministerial level to reduce the system losses including the theft of power. We will address all challenges that result in passing unnecessary costs to consumers,” Matiang’i said.

The CS who also chairs the Cabinet Committee on national government projects said the Government will implement the proposed reforms on Kenya Power by a task force appointed by President Uhuru Kenyatta.

In the report presented to the President last month, the task force chaired by John Ngumi proposed an overhaul of the state power firm be supervised by the Cabinet and a review of the Power Purchase Agreements (PPAs) between the power firm and private firms.

Matiang’i said the Government will expand the recommendations of the task force to undertake a wider review and overhaul of the entire energy sector.

“In the coming weeks, we will launch an aggressive program to address the challenges in the energy sector. We are certain that the prices of fuel will not only come down but even the bills and the costs of electricity we are paying will come down,” he said.

President Kenyatta issued a directive for a 33 percent reduction of electricity tariffs by end of this year.

Already a steering committee chaired by Ngumi has been set up to implement the proposed reforms.