Kenya Power CEO replaced amid fight over tenders

Kenya Power has lost its fourth CEO in four years amid a boardroom fallout that came months after the court dismissed a petition to remove him over past procurement dealings.

The electricity distributor Wednesday announced the exit of Bernard Ngugi, cutting short his three-year term that was to end in October 2022 and replaced him with insider Rosemary Oduor in an acting capacity.

Sources familiar with Kenya Power’s affairs told the Business Daily that Mr Ngugi departed over differences with the Vivienne Yeda-led board that was chosen in November last year.

The source said the new board took an active role in management, including querying procurement decisions and dropping management’s strategy to increase tariff rates that officials believed would lift Kenya Power out of the red.

“The board came with the mentality that Kenya Power is rotten and they have to clean the company. Their main focus has been on tenders where the board has been micromanaging,” said the source.

“There has been bad blood between the board and the management and little is moving. Two months ago, the board sat to remove Mr Ngugi but there was a split.”

Ms Yeda has said that the company’s previous scandals were enabled by a lack of institutional controls.

“The absence of a robust institutional framework created a vacuum, which inevitably was filled by all types (of people) who, for instance, drove Kenya Power into becoming a veritable procurement machine,” Ms Yeda recently told shareholders at firm’s AGM.

Those comments appeared to be an indictment on former Kenya Power bosses, including Mr Ngugi, who was in charge of procurement when the firm signed a contract with a private company for the supply of transformers, which turned out to be faulty.

The Employment and Labour Relations Court in November 2020 dismissed a petition to remove Mr Ngugi from office due to integrity issues relating to the procurement of transformers when he was the general manager for supply chain.

The petition was dismissed on the basis of a defective affidavit.

Mr Ngugi was one of the few senior managers who remained at the firm after a procurement scandal forced out 10 others, including his predecessor, Ken Tarus.

Mr Tarus, his predecessor, Ben Chumo and other senior managers were in July 2018 charged with abuse of office for allegedly entering into a contract with a private firm for the supply of transformers, which turned out to be faulty.

Prosecutors said the deal also flouted procurement rules for State entities. Mr Ngugi’s exit now deepens the management instability at the power monopoly that last year sank into the first loss in 17 years.

“I take this opportunity to thank Bernard Ngugi for his dedicated service to the company, and wish him all the best in his future endeavours,” said Ms Yeda.

Mr Ngugi, who had worked at the firm for over 32 years, was appointed CEO on October 2019.

• The Lancet Commission on Global Surgery estimates that 98 percent of people residing in emerging countries, including Kenya, lack access to multi-specialty surgical services.
• The commission further describes this access to the services as including timeliness, safety, affordability for patients and an adequate capacity by providers.
• This gap forms a good starting point for pursuing the implementation of a multi-specialty growth strategy by clinics and hospitals.

It is an inherent ambition for most healthcare facilities to, over time, increase their scope of services in order to serve a wider catchment population whilst providing a broader array of clinical services.

However, the conundrum that most healthcare managers grapple with is on how, where and what specific activities to pursue in order to actualize this desire in a cost effective and, ultimately, productive manner.

The Lancet Commission on Global Surgery estimates that 98 percent of people residing in emerging countries, including Kenya, lack access to multi-specialty surgical services.

The commission further describes this access to the services as including timeliness, safety, affordability for patients and an adequate capacity by providers. This gap forms a good starting point for pursuing the implementation of a multi-specialty growth strategy by clinics and hospitals.

It is important for healthcare managers to digest available datasets in order to elucidate the characteristics of the disease burden surrounding their health facilities. Such datasets are available both internally and externally.

Internally, records of disease profiles attended to in the facility will be of use; especially of cases that eventually required referral to another center due to non-existence of the needed clinical services.

Externally, the Kenya Health Information System is a freely available online database that contains information on disease burden by type and location in the country. Also, there are specialty-wise medical journal publications that bear extensive information on various disease burdens.

As an example, one may establish that a general outpatient clinic in a hospital setting saw many patients with backaches and of these, the MRIs done showed that most of the patients had spinal compressions but were not definitively attended to due to the unavailability of a neurosurgeon or an orthopedic surgeon specializing on the spine.

The next step would be to consider setting up a spine clinic running on specific days wherein patients presenting with such back problems can be booked into. At this stage, a consideration may be made to invite a visiting specialist doctor to run the clinic on those specified days.

It is worthwhile that during this introductory phase, patients are informed on the need to subscribe to a health insurance scheme so as to limit their need for out-of-pocket expenditure and increase the affordability of such highly-specialized care.

As these occur, the healthcare manager should be forecasting on the supportive services that are required along this specialty line and making plans for the accompanying capital and operational expenditure.

If these cases require surgical interventions, this planning should be around ancillary requirements such as the availability of surgical instruments and implants, staffing cadre, rehabilitative services such as physiotherapy and so on. It helps a great deal to involve input from a specialist in the particular field.

Whereas this example covers a surgical specialty, the same data - driven approach can be applied in all other facets of medical specialties to ensure that an iterative and productive growth approach is undertaken.

The writer is a healthcare leader and geospatial epidemiologist

• The High Court has dismissed a suit filed by minority owner of Bluebird Aviation who accused his partners of siphoning more than $1 billion (Sh108 billion) from the airline through tax evasion, fraud and money laundering.
• Justice Alfred Mabeya brought to an end the five-year court battle pitting Adan Abdi Yussuf against three other owners of the 29-year-old airline.
• The judgment came after the Director of Criminal Investigations (DCI) cleared three shareholders and executives of Bluebird — Hussein Farah, Unshur Mohamed and Mohamed Abdikadir — from financial malpractices after a nine-month investigation.

The High Court has dismissed a suit filed by minority owner of Bluebird Aviation who accused his partners of siphoning more than $1 billion (Sh108 billion) from the airline through tax evasion, fraud and money laundering.

Justice Alfred Mabeya brought to an end the five-year court battle pitting Adan Abdi Yussuf against three other owners of the 29-year-old airline.

The judgment came after the Director of Criminal Investigations (DCI) cleared three shareholders and executives of Bluebird — Hussein Farah, Unshur Mohamed and Mohamed Abdikadir — from financial malpractices after a nine-month investigation.

The investigation followed a criminal complaint from Mr Yussuf against his fellow shareholders, accusing them of fraudulently channelling massive funds out of the company as part of a money laundering scheme.

Justice Mabeya dismissed Mr Yusuf’s allegations, saying he failed to prove claims of fraudulent accounting, tax evasion, fraud and money laundering.

“In the present case, all that the plaintiff did was to make sweeping allegations without any backing by way of evidence. He only stated that he had carried out investigations and made discovery of the allegations he made,” said the judge.

“The documents that were produced were not authenticated to prove any of the allegations made against the defendants.”

Mr Yussuf, who claims to own 25 percent of the charter airline, argued that more $1 billion (about Sh108 billion) has been stolen and put in offshore accounts and investments in Western capitals after being transported physically out of the country without declaration. He said the three directors were using the airport passes granted for restricted areas in airports to move the billions.

The DCI dismissed the secret movement of cash at the airports, arguing its investigation and probe by Kenya Airports Authority (KAA) found no evidence of money laundering.

The Financial Reporting Centre through the DCI said it failed to detect breaches while tracking the flow of cash in and outside Blue Bird Aviation.

Mr Yussuf claimed that his partners were stashing proceeds from the airline in international banks under Amazon International FZE. But Justice Mabeya said his partners had sufficiently showed that their relationship with Amazon was purely commercial.

“That the plaintiff had failed to demonstrate the directorship or shareholding of the defendants at Amazon or that they had stolen money from the Company and deposited the same at Amazon’s accounts,” he said.

“No faithful director exercising independent judgment would take any of the said measures, none of which are beneficial to the Company. In fact, all the steps taken by the plaintiff were contrary to the success of the Company. They were meant to sound a death knell on the company,” he added.