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WAG THE DOG: War on Corruption or a Power Grab?

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WAG THE DOG: War on Corruption or a Power Grab?
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At Sh3 trillion, anyway you cut it, Kenya’s recently unveiled national budget is a monster. It is bigger than the combined budgets of the other four East Africa Community countries. It is nearly double the then record-breaking budget unveiled in the first year of President Uhuru Kenyatta’s first term. To finance it, the government plans to hoover up Sh1.7 trillion in taxes and to borrow another Sh560 billion. However, that will still leave a Sh770 billion hole – roughly the size of Uganda’s 2017 budget.

A budget that size is bound to raise eyebrows and to whet appetites. It has also been presented at a most inopportune time as the country is caught up in the throes of a hysteria over corruption. Each day, it seems, brings new exposés of theft of billions of shillings of public money. The scale of the stealing is fueling a fevered search for scapegoats and there is a literal cry for blood in the street as legislators compete to propose ever more draconian punishments (including public executions) for anyone convicted of the vice.

None of this is new to President Uhuru Kenyatta’s government, which has developed a template for dealing with public anger over graft that essentially boils down to making symbolic offerings to appease it. Three years ago, when facing a similar public tantrum, Kenyatta announced that all implicated senior government officials would “step aside” till they cleared their names. No one really knows what “stepping aside” actually means – it is neither a resignation nor a suspension but it would appear the officials continue to draw a public salary.

The “stepping aside” is then followed by prosecutions. However, there is a catch. Most graft prosecutions involve netting small fry dealing in relatively tiny amounts. Last week, for example, we learnt that a majority of the 57 cases prepared by the Ethics and Anti-Corruption Commission (EACC) involved the theft of under Sh10,000 (roughly US$100). And while it is true that senior officials involved in a Sh10 billion procurement scam at the National Youth Service have been charged in court, it is instructive to note that similar prosecutions in 2015 against 26 individuals involved in a remarkably similar Sh800 million heist at the same institution resulted in 23 acquittals.

Resignations that are not really resignations and prosecutions that are not really prosecutions. The truth is that Kenya’s war on corruption is really just a show, our very own version of Wag the Dog. What is going on here is the political class is using the cover of the corruption hysteria it has incited to settle scores. In the crosshairs is Kenyatta’s deputy, William Ruto, and his allies.

As the “handshake” between Kenyatta and his bitter rival, Raila Odinga, remakes Kenya’s political landscape, the Deputy President has found himself isolated and outmaneuvered and vulnerable in the scrap over who will succeed Kenyatta in 2022. However, even as they fight among themselves, the political elite are careful not to upset the cart. A fake corruption war can help get rid of rivals but all would lose if it was allowed to escalate into a real effort to stamp out the vice.

The truth is that Kenya’s war on corruption is really just a show, our very own version of Wag the Dog. What is going on here is the political class is using the cover of the corruption hysteria it has incited to settle scores. In the crosshairs is Kenyatta’s deputy, William Ruto, and his allies.

And this is what the rhetoric around prosecutions and “stepping aside” is designed to achieve. The privileging of resignations and convictions as the pre-eminent measures of success in the war against corruption allows the Executive to perversely claim to be more committed to fighting graft when more of its members are implicated in graft. Further, it allows the administration to scapegoat the Judiciary for failed prosecutions despite the fact that many of the cases presented in court are shoddily investigated and half-heartedly prosecuted.

More importantly, it means that Kenyatta can escape censure for not doing his job. Because the constitution secures the independence of the Director of Public Prosecutions, President Kenyatta can rightly disavow responsibility for the lack of convictions. But the singular focus on the fate of the so-called “big fish” has kept the public distracted from a much-needed conversation about reforming our governance systems to eliminate incentives and opportunities for graft. There is little in the way of a discussion on policy fixes to plug the leaks, which is Kenyatta’s actual job.

Lie detectors and other gimmicks

Take the Sh11 billion Integrated Financial Management Information System (IFMIS), an automated system for public financial management that has twice been gamed in almost identical fashion at the National Youth Service. It is even more stunning considering that, after the first scam, the Auditor-General had recommended specific reforms to IFMIS that were never implemented. Rather, by December 2016, at the very instance public attention was focused on the grilling of senior officials by Parliament and on prosecutions in the courts, the second scam was already under way.

Instead of offering policy solutions to systemic problems, Kenyatta has taken to introducing gimmicks like lie detector tests as well as to issuing Executive Orders that simply restate what the law already requires and which underscore the fact that it is not enforced. He has demanded that procurement officers submit wealth declarations, which they are already obligated to do every two years by the Public Officer Ethics Act. Most recently, he ordered all government entities to publish full details of tender awards, again as already required by the Access to Informationn Act.

But even as Kenyan media breathlessly report these “developments”, there is no questioning of why these laws weren’t enforced previously. If such questions were raised, Kenyans might begin to understand that the way the laws are designed defeats rather than achieves the goal of fighting corruption. For example, the requirement for wealth declarations, for example, is rendered nugatory by the fact that the declarations are by law kept secret, that the function of collecting the declarations is distributed across a number of bodies, and that there is no legal obligation placed on these bodies to verify or to audit the declarations.

However, instead of proposing the necessary changes to the legal regime to actually give it teeth, President Kenyatta has ordered a lifestyle audit of all public servants, again without detailing who exactly would carry it out and how they would do it. Rather than fix the systemic problems, the President is trying to make political hay.

The focus on prosecutions also misses the larger picture. Anti-corruption crusader and publisher of The Elephant, John Githongo, wrote in the e-Review that “corruption in Kenya isn’t about greedy procurement officers, fiddling civil servants, crooked businessmen, shady bankers, thieving politicians… these players are born of a system of politics and governance that is itself inherently corrupt; one in which the thieves and those who facilitate them thrive.” Understanding this is the key to solving the corruption riddle.

However, instead of proposing the necessary changes to the legal regime to actually give it teeth, President Kenyatta has ordered a lifestyle audit of all public servants, again without detailing who exactly would carry it out and how they would do it. Rather than fix the systemic problems, the President is trying to make political hay.

African gifts and other myths

Many times it has been suggested that graft is a cultural problem that grew out of a supposed “African” tradition of gift-giving. Now, it is a good practice to be sceptical every time someone uses the word “African” to imply a uniformity on the continent – and here a healthy dose of scepticism would be justified. As Joe Khamisi’s history of corruption, Looters and Grabbers: 54 Years of Corruption and Plunder by the Elite 1963-2017, demonstrates, corruption was the gift of colonialism. It was, and still is embedded into the very fabric of the state the British created. The logic of that state was to legitimise the stealing by the few from the many, a logic that was evinced through the state’s design.

In fact, Kenya was corrupted even before it became Kenya. By 1907, thirteen years before the territory officially became a colony, bribery was already a feature of the nascent state. Khamisi cites Hugh Cholmondeley, popularly known as Lord Delamere, a leader of the British settlers, describing the relations between the public and the new rulers: “Time and time, I have had a native say they were stopped by an Indian policeman. When I asked them how they got away, they always said, ‘Oh, I gave him something.’”

Khamisi also describes how corruption seeped from the white colonial establishment down to its African enforcers, the appointed chiefs and policemen. A state built to steal was itself peopled by thieves. As David Anderson says in Histories of the Hanged: The Dirty War in Kenya and the End of Empire, “Europeans were as guilty of corruption and malpractice in colonial Nairobi as anyone else, and Africans at the bottom of the colonial racial hierarchy were most often its victims.” The Rose Commission, which was established in 1955 to look into “alleged corruption or other malpractices in relation to the Affairs of the Nairobi City Council” found that “the practice of City Council servants demanding or accepting, and of contractors offering, bribes or, if you prefer, money presents for services rendered or to be rendered, [was] by no means uncommon”.

Corruption was baked into the state and its templates were established from early on. At the top, the white elite ripped off the state through public projects, such as the railway and the construction of public housing, while at the bottom, poorly paid chiefs, members of African courts and police supplemented their incomes by extorting from the people. As Khamisi puts it, citing David Leonard’s African Successes: Four Public Managers of Kenyan Rural Development, “Through corruption and bribery, chiefs were transformed into willing agents of colonialism and were implicitly encouraged to use their positions to amass wealth and demonstrate to all and sundry that it paid to cooperate with Europeans.” In this manner, corruption became institutionalised as a way of doing government business. And when those chiefs and their kids inherited the state from the British, they really did not know any other way to be.

Fixing systemic flaws

Following independence in 1963, the civil service was massively expanded. But the Jomo Kenyatta (Uhuru’s dad) administration was not keen on paying for it. Following the colonial model, in 1971 the Ndegwa Commission recommended allowing civil servants to supplement their wages with private business. This had the effect of legalising corruption and legitimising conflict of interest situations. The looting ramped up and it has been escalating ever since.

Understanding the systemic roots of corruption would allow Kenyans to see that successful prosecutions, while a necessary part of a credible anti-corruption strategy, will not fix he problem. Deterring and punishing the corrupt is no substitute for fixing a system that not only permits, but also rewards graft. Convictions, even in the unlikely event that meaningful ones are secured, would be ineffective so long as a third of the government’s budget, some Sh600 billion according to the EACC, continues to be available to be stolen every year.

Following the colonial model, in 1971 the Ndegwa Commission recommended allowing civil servants to supplement their wages with private business. This had the effect of legalising corruption and legitimising conflict of interest situations. The looting ramped up and it has been escalating ever since.

The fact is that the rewards of corruption far outstrip Kenya’s capacity to punish it. The country’s energies would be better spent in holding political leaders accountable, not just for delivering convictions and harsher sentences, but for shutting down the gravy train. And that will require reforming how the Kenyan state works.

Here we can take some lessons from the colonial times. A report from the Kenya National Commission on Human Rights says that while the pre-independence civil service was corrupt, it “had its avarice kept to a minimum by the vigilance of the white settler community that it served”. If Kenya were serious about addressing corruption, ensuring that the public can effectively keep watch on the state should be at the top of the list. Everything from public contracts to wealth declarations should be exposed to the discerning gaze of the people.

And rather than token public participation in budget making, it is important to ensure that the public is involved in all aspects of decision making. As Nic Cheeseman wrote in 2015 on the subject: “The budget process can be understood to have three main stages when it comes to public participation: participatory budgeting, budget approval and communication, and budget review and audit. Ideally, participation should occur at all three stages, because public oversight is an important way to tackle both policy formation and corruption.”

Empowering the public to more actively participate in and oversee the affairs of the government will require a radical retrofitting of the colonial state. To date, Kenya’s second attempt at doing this seems to be going the way of the first. The 2010 constitution was in essence a reset to 1963 and the independence Constitution, which had many of the same features. However, that constitution failed largely because, as former Attorney General, Githu Muigai, wrote in 1982, it was imposed on an authoritarian, administrative structure. “Unhappily instead of the latter being amended to fit the former, the former was altered to fit the latter with the result that the constitution was effectively downgraded.”

That same colonial understructure is alive and well today, doing its best to undermine the operation of the new Constitution and its values of transparency and accountability. The biggest blow was to Chapter 6 of the Constitution that deals with leadership and integrity. This Chapter was effectively demolished when in the run-up to the 2013 election, a High Court ruled that Uhuru Kenyatta and his running mate William Ruto, two of the six Kenyans indicted by the International Criminal Court for crimes against humanity, could run for the office of the President and Deputy President of the Republic, respectively. It is, therefore, a cruel irony that Kenyatta is now demanding public officials indicted for corruption to do what he was himself unwilling to do then – step aside till he cleared his name.

Déjà vu

Sadly, it is not constitutionalism or respect for the law and for institutions that is driving Kenyatta’s anti-corruption rhetoric. It is not even concern over the looting of public funds; rather, this is a power grab. The President is seeking to substitute his will for the law. Officials step aside, or are prosecuted, not because the law requires it, but because the President ordered it. They are vetted, make wealth declarations and undergo lie detector tests for the same reason.

Under the veil of the anti-corruption drive, the President is actually conducting a campaign to delegitimise the constitution and concentrate power in himself. And if there is one thing our history teaches us, it is that this will not turn out well for the majority of Kenyans.

Sadly, it is not constitutionalism or respect for the law and for institutions that is driving Kenyatta’s anti-corruption rhetoric. It is not even concern over the looting of public funds; rather, this is a power grab.

Beyond the President’s actions, Kenya has seen the demand for punishment used to undermine other constitutional protections. A significant one is the right to bail, which is today being presented as an extension of impunity. For a long time, Kenyans have been conditioned to equate arrest with both prosecution and punishment. In fact, during the Jomo Kenyatta and Daniel arap Moi dictatorships, detention was itself used as punishment, not as a means to facilitate justice.

And, as a 2015 report by a judiciary task force on bail and bond guidelines found, “historically, police officers rarely grant cash bail to suspects of any offences other than traffic offences in spite of the provisions in the Constitution, C[riminal] P[rocedure] C[ode] and the Police Standing Orders which give discretionary powers to exercise that function.” Today, when people clamour for corruption suspects (and that’s all they are till convicted) to be denied their constitutional right to bail, many do not understand that they are eroding that same right for themselves and inviting the abuses of yore.

In the end, to effectively fight corruption, we must focus on systems and incentives, as well as uphold and strengthen, rather than undermine our institutions and laws.

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Mr. Gathara is a social and political commentator and cartoonist based in Nairobi.

Politics

Would Ochieng Still Accuse the Press 30 Years Later?

The Kenyan media landscape has changed drastically in the time since Philip Ochieng wrote I Accuse the Press but the core of his argument remains pertinent.

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Would Ochieng Still Accuse the Press 30 Years Later?
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Dark prologue

Veteran journalist Philip Ochieng Otani exploded onto Kenya’s journalism scene in 1966 as a reporter for the Daily Nation aged 28. The country was just beginning to shed off the baggage of violent colonial rule, ushering in a new decade of political and cultural independence. However, beneath the promise of a glowing future that saw more black Africans take over from the British, the country was also starting to write a prologue to its self-destruction. By 1965 nationalist Pio Gama Pinto was dead. Jaramogi Oginga Odinga angrily resigned from Kanu the following year to form his party, and three years later Economic and Planning Minister Tom Mboya was cut down by an assassin’s bullet in broad daylight. The Kenyan press, though now relatively free and able to finally “concern itself with finding out what goes on in the mind of the African”, as Mboya had earlier put it, later suffered the cascading political events that would have a lasting effect on its editorial policies.

Ochieng published I Accuse the Press: An Insider’s View of the Media and Politics in Africa in 1992, crystallising his wide-ranging thoughts around three central issues: the question of media ownership, self-censorship among editors and the know-how of journalists. He extended the idea of know-how to know-why, whereby the journalist is not just a conveyor belt of information but also has the necessary analytical sensitivity to break down the information for the reader’s benefit.

Born a precocious child in Awendo, Western Kenya, a story is told of how the then Alliance High School principal Carey Francis drove several kilometres to Ochieng’s village to convince him to return to school. Ochieng, as the legend goes, had entangled himself in bad company and was on the verge of dropping out of education, which he eventually did – not from Alliance, but from Roosevelt University in the US, where he had enrolled after benefitting from the Kennedy Airlift programme of 1959. These rather disparate intellectual foundations shine with dazzling brilliance through the pages of his book, illuminating the history of the Kenyan press that has had a profound impact on the current media landscape.

Media ownership and its dangers 

Along Tom Mboya Street, just across the Khoja Mosque roundabout, is a building that used to house the Daily Nation offices. It is now called Old Nation House and only the name remains as a reminder that a media house once stood on the busy street. The building now houses shops, the sidewalk colonised by hawkers, make-shift confectionary stalls, booksellers, fruit sellers, clothes vendors, chemist shops and MPesa outlets. On the surface, the city is booming. A new world order brought about by advancements in digital technology and a liberalised media means that most of these traders don’t really care about media gatekeepers. Should they? Nation Media Group, which owns Daily Nation among other media products, and which is itself owned by Aga Khan IV, later moved to the relatively quiet Kimathi Street. Over the years, it has undergone radical transformations, unlike when Ochieng worked there, especially in the heady 1970s and 1980s, which form the backdrop of his long and intellectually stimulating musings.

Ochieng’s take on media ownership falls into three broad categories: foreign-owned, indigenous-owned and state-owned. These categories often overlap, in that a foreign-owned publication, such as Daily Nation, also has its indigenous Kenyan journalists, and editorial matters (or decisions) are left strictly to those tasked with running the paper – who in this regard include the top editors, led by the editor-in-chief. Indigenous-owned media, on the other hand, is in the hands of Kenyans but can also be susceptible to outside influence, like in the case of Hilary Ng’weno’s string of publications, which urgently needed a bailout after he plunged into financial headwinds. The indigenously-owned media outlet that is most familiar to Kenyans today is S.K. Macharia’s Royal Media Services.

Interestingly, Ochieng makes a compelling argument about the relationship between media ownership and press freedom. For example, he says, in special circumstances, state ownership “has tended to safeguard freedom – not only of the Press but the whole society – from material wants much more genuinely than has private ownership”. He goes on to cite Tanzania, where the state-owned papers in the 1970s played a vanguard role in protecting the gains of independence, while at the same championing Ujamaa – a socialist ideology aimed at self-reliance. While that statement would today sound unpopular, conservative, and be even deemed right-wing, there is a grain of truth to it. Private media ownership on the other hand, as the author vividly illustrates, does not necessarily mean there is press freedom.

Ochieng makes a compelling argument about the relationship between media ownership and press freedom.

A case in point is how the mainstream media handled the 2013 and 2017 general elections. Hiding behind a peace narrative, or what some observers have called “peacocracy”, the media tiptoed around the underlying issues that ignited the flames of electoral violence. The media on this occasion failed in its role, which Ochieng says is to provide “a full analysis of the whole system”. By becoming that which it was supposed to critique, the media lost the trust of a large swathe of the Kenyan audience. And this is why the argument for state-ownership of a newspaper or broadcaster (KBC, for instance) becomes relevant because, at the very least, the audience knows what to expect.

However, the argument about state ownership should not be endorsed wholesale. The case of the Kanu-owned Kenya Times, and its infamous “Kanu Briefs”which Ochieng has been placed at the centre of, for orchestrating a sustained smear campaign against politicians and intellectuals who were against the ruling party is a chilling reminder that the state must never have unchecked control of a country’s political and cultural consciousness. In recent years, politicians have been linked to various media houses, and this in itself is not a bad thing; however, vigilance must be maintained at all times to guard the media against direct political interference.

Then came the internet. Then social media. Then Facebook.

When a 20-year-old computer science and psychology student at Harvard University wrote code for a website project that would later become the interactive platform named Facebook, few could imagine the technological dividends the millennials and Generation Z would reap, accustomed as they were to filtered news and omnipresent gatekeeping (particularly the millennials). There was a fundamental shift in media ownership because if you had a social media account, you could now publish, broadcast and counteract news from mainstream sources such as newspapers and television. One could also start a blog,  an online newspaper or magazine, or a YouTube channel, qualifying Ochieng’s statement that “freedom of expression is primarily a technological question”. This means that the question of media ownership and the idea of a free press in the 21st century can no longer be merely about buying shares in a media company and telling news managers and editors what to publish and what to censor.

While there are indeed genuine concerns with the citizen journalism promoted on social media platforms, especially with the rise of misinformation and disinformation that threatens the social fabric of society, the gains made so far cannot be downplayed. But how these platforms can counter narratives of self-censorship by proxy, as Ochieng puts it in his book, matters more.

The question of self-censorship

Ochieng makes a lucid argument that self-censorship affects media independence because readers do not get the value of what they pay for. More importantly, self-censorship is informed by the commercial interests of corporate mass media because “whoever owns the majority of the shares” of a particular media company will definitely affect its overall editorial policy. I want to demonstrate a recent example of what perfectly encapsulates self-censorship on the part of the Kenyan press.

During the 2017 general election, a 41-year-old man wearing a pair of brown trousers, a matching brown coat, a black and white shirt, and clutching a bag of githeri in his left hand, burst onto the media scene and became an instant sensation. Martin Kamotho, for that was his name, became the subject of wild adoration. It was, however, the manner in which the mainstream press glorified Kamotho that later became the subject of intense debate. The country was already in the grip of political tension – as usually happens during a general election – and Kenyans were beginning to question whether the polls would indeed be credible following the murder of Chris Msando, a key IEBC official. Claims that critical IT infrastructure used to transmit the results had been hacked were also of general concern. There was an overall perception that the media as an institution had learned its lessons in the 2013 general election and that it could not trust the state when it comes to setting the agenda in election reporting.

Ochieng makes a lucid argument that self-censorship affects media independence because readers do not get the value of what they pay for.

However, the case of Kamotho, later christened “Githeri Man”, exposed the crass hypocrisy of the mainstream media and its cunning ability to censor itself because it knew it could not muster the courage to answer the tough questions Kenyans were asking. Ochieng is, therefore, right that there are “the kinds of chains with which owners, managers and editors tie their own media in order to make them conform to the total ethos of the ruling class [that] cannot be seen by the majority of the people”. However, Kenyans saw through the game that was being played, and the backlash was immediate. Mainstream media was quickly baptised “Githeri Media” – purveyors of fake news, disinformation and misinformation, state apologists, propagandists who, as the fourth estate, had failed in their role to keep the government accountable.

The media’s fixation with “Githeri Man” was not just about pleasing the political class or protecting its (the media’s) commercial interests. It was also about the glaring absence of know-why among journalists – the ability to ask why a certain narrative is being vigorously promoted and not another, and what effects such an editorial policy has on the health of Kenyan journalism.

Shift towards know-why journalism 

Ochieng writes that “as long as [media] training stresses little more than technique and avoids the whole problem of self-consciousness” then “training can only serve as an instrument for perpetuating the present international economic and intellectual order”. Journalism as an enterprise then becomes what I called earlier a mere conveyor belt of information, which serves no purpose in making us more aware of the immediate problems of the 21st century such as climate change, the dangers of identity politics, pandemics, repressive immigration laws, the rise of far-right ideology and the tyranny of social media companies, among others.

Kenyans saw through the game that was being played, and the backlash was immediate.

Know-why journalism, however, cannot fully bloom without sufficiently addressing the issue of know-how. The latter, which at the most basic level is about technique, is also about understanding the shifts in media operations, and how to adjust to those changes. Know-how then means having the ability to tell stories across varying multimedia platforms that include podcasts, videos, and texts. And because consumer tastes have also evolved over the years, know-why journalism can only succeed when know-how as a skill has been extensively sharpened.

Closing curtain

Ochieng danced to the land of no return on 27 April 2021, aged 83 years. During an interview with the Saturday Nation, when asked if he “would make the same accusations” in I Accuse the Press, he said he was still likely to do just that, but be “more enlightened and thoughtful about it.” However, by standing up to the hypocrisy of the mainstream media and its connivance with the state and Western business interests, Ochieng had set the stage for a new chapter of self-criticism for journalists and media practitioners. Ochieng stood with the audience in demanding that the media play its watchdog role more effectively by delving deeper in its analysis of issues.

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Politics

Is It the IEBC Chairperson or the Commission Who Declares a President-Elect?’

On the limited point of whether Chebukati had the power to make the declaration that he did on 15th August, 2022, we are of the view that he did and that in doing so he has fulfilled the obligations required of his office in accordance with the principles of the Constitution and the relevant election laws.

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After a tallying process which ran from 9 August to 15 August 2022, Independent and Electoral Boundaries Commission (IEBC) Chairperson Wafula Chebukati declared that Hon. William Ruto had met the constitutional threshold for election as president and is therefore the President-elect. Moments before this announcement, four IEBC Commissioners—Juliana Cherera, Francis Wanderi, Irene Masit and Justus Nyangaya—issued a statement to the press disavowing the results and alleging that, due to the ‘opaque nature’ of the way the final ‘phase’ had been handled, they could not ‘take ownership’ of the results. A day later, the four Commissioners provided their reasons for disavowing the Chairperson’s declaration, key among them being that the Chairperson excluded them from the decision to declare Hon. Ruto as president-elect. Hon. Ruto’s chief competitor, Hon. Raila Odinga, has also rejected the results on similar grounds.

We have been here before of course. In 2017, there was a fallout between Chebukati and three of his Commissioners on the basis that the Commissioners did not agree with Chebukati’s leadership. As we have argued previously, the IEBC is in need of structural reform.

The events of 15th and 16th August, 2022 have stirred debate about the roles envisaged for the IEBC Chairperson and its Commissioners by the Constitution and Kenya’s election laws. Does the Chairperson’s declaration square with the law? Was he required to have a majority of the Commissioners in agreement with his declaration? Is the declaration of a winner a mere ceremonial function of the Chairperson?

The constitutional and statutory framework

Before answering these questions, it is important to look at the relevant Constitutional and statutory framework.

The IEBC is established by Article 88 of the Constitution which in sub-article (5) states that “[t]he Commission shall exercise its powers and perform its functions in accordance with this Constitution and national legislation”. The Independent Electoral and Boundaries Commission Act (IEBC Act) was then enacted in 2011 to operationalise the entity and is the “national legislation” envisaged in the Constitution.

In relation to presidential elections, the Constitution, in Article 138(3)(c), provides that “after counting the votes in the polling stations, the Independent Electoral and Boundaries Commission shall tally and verify the count and declare the result”.

Article 138(10) of the Constitution then provides that “[w]ithin seven days after the presidential election, the chairperson of the Independent Electoral and Boundaries Commission shall –

  • declare the result of the election; and 
  • deliver a written notification of the result to the Chief Justice and the incumbent President.

Section 39 of the Elections Act provides, in part:

“(1C) For purposes of a presidential election, the Commission shall – 

  • electronically transmit and physically deliver the tabulated results of an election for the President from a polling station to the constituency tallying centre and the national tallying centre; 
  • tally and verify the results received at the constituency tallying centre and the national tallying centre; and
  • publish the polling result forms on an online public portal maintained by the Commission.

(1E) Where there is a discrepancy between the electronically transmitted and the physically delivered results, the Commission shall verify the results and the result which is an accurate record of the results tallied, verified, and declared at the respective polling station shall prevail.

(1H) The chairperson of the Commission shall declare the results of the election of the President in accordance with Article 138(10) of the Constitution.”

Regulation 83(2) of the Election (General) Regulations, 2012 provides that “[t]he Chairperson of the Commission shall tally and verify the results received at the national tallying centre.” Further, Regulation 87(3) reads, in part:

“Upon receipt of Form 34A from the constituency returning officers under sub-regulation (1), the Chairperson of the Commission shall – 

  • verify the results against Forms 34A and 34B received from the constituency returning officer at the national tallying centre; 
  • tally and complete Form 34C;
  • announce the results for each of the presidential candidates for each County;
  • sign and date the forms and make available a copy to any candidate or the national chief agent present;
  • publicly declare the results of the election of the president in accordance with Articles 138(4) and 138(10) of the Constitution;
  • issue a certificate to the person elected president in Form 34D set out in the Schedule; and
  • deliver a written notification of the results to the Chief Justice and the incumbent president within seven days of the declaration…”

Unpacking the legal position 

So, what does this all mean?

Immediately polls close, the Elections Act and its subsidiary legislation require presiding officers at each polling station to openly count ballots and declare the result. The result from each polling station within a constituency is then aggregated at constituency level and a result of this aggregation is declared by respective constituency returning officers. This process is then replicated at the national tallying centre where the Chairperson of the IEBC serves as the returning officer for the presidential elections declares the winner.

Both the IEBC Commissioners and Hon. Odinga have, in their public statements on Chebukati’s declaration of Hon. Ruto, sought to rely on a Court of Appeal decision, IEBC v Maina Kiai & 5 others [2017], suggesting in effect that the role of national returning officer does not exist and that the Chairperson is not vested with the power to declare a result without consensus or a majority decision of the Commissioners. However, this is not an accurate account of the issue before the court and its eventual holding. The issue before the court in Maina Kiai related, principally, to the ability of the Chairperson to alter results during the verification process. In question, were certain provisions of the Elections Act and the Elections (General) Regulations which provided that results declared at polling station level were ‘provisional’ and ‘subject to confirmation’, vesting in the Chairperson the ability to alter results at the national tallying centre. The Court of Appeal confirmed the constitutional and statutory position that the result declared at the polling station by presiding officers is final and cannot be altered by anyone other than an election court.

The Court was abundantly clear that Article 138(3)(c) deals with counting, tallying, verification, and declaration by the presiding officer at the polling station level and returning officers at each subsequent level, and not just the Chairperson at the Commission level. In other words, in discharging its mandate under Article 138(3)(c), the IEBC, which is a body corporate, acts through its representatives who are the presiding officers and returning officers. In undertaking the verification exercise at subsequent levels after the polling station, the respective officers are simply required to confirm whether the tally at each level conforms to the declaration which was made by the presiding officer at the polling station and to declare this result. Consequently, the constituency returning officer and the national returning officer (who is the IEBC Chairperson) cannot alter the results in any way when making these declarations. This is the mischief that the Maina Kiai case addressed, and in doing so, it invalidated certain sections of the Elections Act and the Elections (General) Regulations which suggested that results at the polling station level were provisional and subject to alteration or confirmation by the Chairperson. By doing this, the Court of Appeal aligned these laws with the Constitutional position.

Notably, Regulation 83(2) and 87(3) of the Election (General) Regulations which we quoted above, and which empower the Chairperson to tally, verify, and declare the results received at the national tallying centre, were not the subject of the Maina Kiai decision, and as such were not invalidated.  However, the Court of Appeal clarified that in tallying and verifying results, the Chairperson is bound by the results declared at each polling station which are final. Indeed, in the Maina Kiai case, the Court of Appeal recognised the special role of the Chairman and stated:

It cannot be denied that the Chairperson of the appellant has a significant constitutional role under Sub-Article (10) of Article 138 as the authority with the ultimate mandate of making the declaration that brings to finality the presidential election process. Of course, before he makes that declaration his role is to accurately tally all the results exactly as received from the 290 returning officers country-wide, without adding, subtracting, multiplying, or dividing any number contained in the two forms from the constituency tallying centre. If any verification or confirmation is anticipated, it has to relate only to confirmation and verification that the candidate to be declared elected president has met the threshold set under Article 138(4), by receiving more than half of all the votes cast in that election; and at least twenty- five per cent of the votes cast in each of more than half of the counties.”

So, if anything, the Maina Kiai decision reinforced the role of the Chairperson as the national returning officer of the presidential election, contrary to the statement issued by the four Commissioners on 16th August which alleged that such a role does not exist.  Further, the Supreme Court of Kenya in the Joho v Shahbal case made it clear that a declaration takes place at each stage of tallying, implying that the verification and declaration process is not the preserve of the Commissioners. It is done by the respective presiding and returning officers at each stage. The High Court, at an earlier stage of the same case, had confirmed that declarations are made through formal instruments, which in the electoral context, are the certificates issued by the respective returning officers. To render even more clarity, in its majority decision in Petition 1 of 2017 Raila Odinga v IEBC & 2 others [2017], the Supreme Court stated that ‘[t]he duty to verify in Article 138 is squarely placed upon the IEBC (the 1st respondent herein). This duty runs all the way from the polling station to the constituency level and finally, to the National Tallying Centre. There is no disjuncture in the performance of the duty to verify. It is exercised by the various agents or officers of the 1st respondent, that is to say, the presiding officer at a polling station, the returning officer at the constituency level and the Chair at the National Tallying Centre’.

With both the Constitutional and statutory framework and this recent jurisprudence in mind, it is apparent that when it comes to the declaration of results, the Chairperson is not merely performing a ceremonial role on behalf of the Commission but has a singular responsibility to discharge a constitutional duty to declare a president-elect after verifying the results. Once the presiding officers and constituency returning officers discharge their mandate, they hand the baton to the Chairperson for him to also do so. He therefore does not discharge his mandate in isolation or in an arbitrary manner; his role is hinged upon other IEBC officers at various levels dispensing with their mandate. Like the rest, he may not deviate from the declaration made at the polling station. In that way, he acts as a representative or an agent of the entire IEBC in discharging his mandate. This position is aligned with the Elections (General) Regulations and the Supreme Court’s decision in Raila v IEBC which provide that the Chairperson, as the IEBC’s agent, can verify the results and make a declaration. For these reasons, Chebukati’s declaration, we argue, is in accordance with the law.

In public debates following Chebukati’s declaration of a president-elect, there has been an argument in some quarters that the Second Schedule to the IEBC Act and in particular paragraph 7 which reads “[u]nless a unanimous decision is reached, a decision on any matter before the Commission shall be by a majority of the members present and voting”, suggests that the dissension of the majority of the Commissioners on grounds of ‘opaqueness’ meant that Chebukati did not have the authority to make the declaration. Azimio La Umoja Coalition Party presidential candidate Hon. Odinga forms part of the individuals advancing this argument when rejecting the legality of Chebukati’s declaration of Hon. Ruto as president-elect. The Second Schedule is made pursuant to Section 8 of the IEBC Act which provides that “[t]he conduct and regulation of the business and affairs of the Commission shall be provided for in the Second Schedule but subject thereto, the Commission may regulate its own procedure.” The Second Schedule is akin to the provisions of the Articles of Association of a company which deals with how board meetings are conducted.  It deals with matters such as how meetings are called, how quorum is formed and other such administrative matters. Note that paragraph 7 is specifically limited to matters ‘before the Commission’. As set out in the preceding paragraph, the declaration of a president-elect is a matter for the Chairperson and not a matter ‘before the Commission’.

In any case, those arguing the contrary have two further obstacles to overcome. Firstly, how do they reconcile their position with the clear constitutional injunctions imposed on the Chairperson by Article 138(10) requiring the Chairperson to declare the results of the Presidential election within 7 days after the Presidential election. What did they expect Chebukati to do? Continue negotiating with the dissenting Commissioners and allow the 7 days to expire? If so, does this mean Chebukati should place the views of his Commissioners above the Constitutional requirement in Article 138(10) even though, at each stage, representative officers of the IEBC verified, declared, and made the results public?  The reason for Article 138(10), in our view, is obvious. In matters relating to the transfer of Presidential power, certainty of process and timing is critical. One cannot leave matters in abeyance and risk a constitutional crisis with an incumbent holding on or causing the delay in the assumption of office by his successor. This would be a recipe for a constitutional crisis with a myriad of implications for Kenyans, especially in relation to their safety and security.

Ultimately, Chebukati’s decision is not final: there is the Supreme Court to which those disgruntled by his declaration can appeal. Although not final, finality in the process of tallying and subsequent declaration is critical. To take such a dramatic step of disavowing the results at a moment when the country was on edge, we would have thought that the four Commissioners would present some compelling evidence pointing to miscalculation on the part of Chebukati in the tabulation of the statutory forms 34A, 34B and 34C. Kenyans have not yet been presented with any such compelling evidence.

Turning to the absence of compelling evidence, one would expect a detailed explanation from the four Commissioners. In their statement following their initial announcement, they disclosed four reasons for their dissent. The first was in relation to the aggregation of the tally surpassing 100% by a margin of 0.01%. A simple calculation reveals that the error may be attributable to the Chairperson rounding the figures upward for purposes of the declaration.

Their second reason was that the Chairperson, in his declaration, did not indicate the total number of registered voters, the total number of votes cast or the number of rejected votes. The declaration of results form available on the IEBC’s website indicates that this is not true as the declaration form does contain all this information.

In their third reason, the Commissioners relied on the Maina Kiai decision to allege that the “Commission has to process the results before they are declared and announced by the Chairperson”. As we have set out above, the Court of Appeal in Maina Kiai indicated that the IEBC, as a body corporate, acts through its officers, specifically the presiding and returning officers who fulfil the IEBC’s obligation under Article 138(3)(c) of the Constitution on the institution’s behalf. Given the results were, at each stage, tallied, verified, and declared by presiding and returning officers including the Chairperson, it is not immediately clear what further ‘processing’ the Commissioners wanted to subject the results to, especially when the Court of Appeal explicitly held that once declared at constituency level, a result is final. The law certainly does not disclose a role for these Commissioners to ‘process’ these results any further. It only envisions a role for the Chair to verify the results and make a declaration. The reliance on Maina Kiai is also misleading in the sense that it implies the Chairperson acted in isolation and in an arbitrary manner, yet he was clearly bound to the results declared by other officers at the polling station level which were publicly available.

Their final reason was that the Chairperson made his declaration before several constituencies had their results declared. The Elections Act provides that the Chairperson may only do so if “in the opinion of the Commission the results that have not been received will not make a difference with regards to the winner”. However, the challenge with this reason is that the Chairperson did not indicate that his declaration was made on the basis that the results were not complete and that the remainder would not make a difference. Perhaps at the Supreme Court, this ground will be elaborated on further.

In light of the above, on the limited point of whether Chebukati had the power to make the declaration that he did on 15th August, 2022, we are of the view that he did and that in doing so he has fulfilled the obligations required of his office in accordance with the principles of the Constitution and the relevant election laws.

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Arror & Kimwarer Dams Saga: Fighting Corruption or Realpolitik?

The cases at the Milimani Anticorruption Court provide few concrete answers amid claims that the investigations into the Arror and Kimwarer Dams projects are politically motivated to weaken Deputy President William Ruto who is running for the presidency.

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Arror & Kimwarer Dams Saga: Fighting Corruption or Realpolitik?
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A joint investigation by IrpiMedia and The Elephant

Soon after Uhuru Kenyatta and his deputy William Ruto secured a controversial second term in November 2017, investigations begun into the procurement and financing arrangements surrounding the Arror and Kimwarer dams in the Rift Valley county of Elgeyo Marakwet.

The dams had been commissioned years earlier, and billions had been paid out but there was nothing on the ground to show for either dam. The Kimwarer project has since been cancelled, the Arror one scaled down, and eight defendants today face charges of conspiring to defraud the government of nearly Sh60 billion. However, there have been claims that the investigations and prosecutions are politically motivated and aimed at weakening Deputy President William Ruto who is running to becoming Kenya’s fifth president. Just this week, during the presidential debate, Ruto essentially said the dams were casualties of the 2018 fallout with his boss. This has been many times denied by the Director of Public Prosecutions.

The two cases dealing with the dams at the Anti-Corruption Court in Milimani, Nairobi, focus on alleged irregularities in the tendering and contracting of the dams as well as alleged illegal payments made to two Italian companies. The crux of the ODPP’s case is that officials of Kerio Valley Development Authority and the national government colluded to grant CMC di Ravenna and its joint venture partner, Itinera S.P.A, a contract for the construction of the two dams for which they had not won the tender and that differed fundamentally from the terms advertised in December 2014, which called for proposals for the “funding, design, build and transfer” of the dams. The eight Kenyan officials in case No. 20 of 2019 and the 18 Italian companies and individuals in case No. 21 of 2019, are accused of executing a sleight of hand, initially pretending that the contractors would mobilize money from the Italian government to build the dams and then switching it to a commercial loan with the government as the borrower. Furthermore, instead of the borrowed money being deposited into the Consolidated Fund as the constitution prescribes, on the contrary, it was sent directly to the contractor. In the ODPP’s view, this is where the fraud arose.

The initial contracting model selected was Engineering, Procurement, Construction and Financing where the contractor also arranges financing for the project through tie-ups with financing institutions. They can be useful when contractors have better access to low-cost financing, including state-provided export-import financing. However, the Parliamentary Service Commission has noted that these contracts are vulnerable to abuse and in 2019 parliament suspended 20 dam projects, including Arror and Kimwarer, saying “Kenyans [were] not getting value for money in this model”.

According to the ODPP, the tendering process for the two dams was riddled with irregularities. In an affidavit sworn in February 2020 on behalf of the DPP, Police Constable Thomas Tanui states that, unlike the Arror dam, the Kimwarer project had not been approved by the Cabinet, as required by the 2013 Public Private Partnership Act (PPA). Further, in the course of the process, the tender documents for CMC di Ravenna were illegally altered at least twice to switch CMC’s joint venture partners from South Africa’s AECOM to a company only known as MWH, and then again to Itinera S.P.A. And while it was Italy-based CMC di Ravenna that made the bid, the tender was awarded to South Africa-based CMC di Ravenna, a different legal entity with whom KVDA signed Memoranda of Understanding regarding the two dams in December 2015 and February 2016 that were meant to end with the signing of concessional contracts within 8 months.

However, the MOUs expired without the concessional contracts being signed and instead, on 5 April 2017, the KVDA signed commercial contracts for the construction of both dams with the Italian CMC di Ravenna and its joint venture partner Itinera S.P.A. for a total combined amount of US$501.8 million, including 10 per cent contingencies that had not been negotiated for under the concessional agreements.

In his affidavit, PC Tanui avers that the dam projects were conceived as concessionary projects under the PPA but were surreptitiously converted into a commercial instead of a concessional contract. However, what the ODPP means by “concessional contract” and how that differs from a commercial contract is not clear. There’s no mention of a “concessional contract” in the PPA which defines a concession as “a contractual licence . . . entitling a person who is granted the licence to make use of the specified infrastructure or undertake a project and to charge user fees, receive availability payments or both”. While the law allows government agencies to “enter into a project agreement with any qualified private party for the financing, construction, operation, equipping or maintenance” of infrastructure, none of the 15 types of public private partnership arrangements it lists in its second schedule seem to fit what KVDA had initially advertised.

However, perhaps what the ODPP refers to as a “concessional contract” is a reference to the way the project was to be funded. According to press reports and Richard Malebe’s petition, the initial charges alleged that  the national government and KVDA officials as well as the Italian companies conspired to “entered into a commercial loan facility agreement disguising it as a government-to-government loan guaranteed by the Italian Government . . . ‘while knowing the tender document contained in the request for proposals for the development of the dams project was a concessional agreement where the intended concessionaire was to be the borrower and financier and not the Government of Kenya’”. In essence, by substituting the commercial contract for the concessional one, rather than an arrangement where Government only paid once the dams were delivered, with the contractor and financiers assuming all the risk, it was the public that was left holding the baby when things went wrong. If anything, the Kenyan public paid to insure the banks against government default, which insurance the ODPP says was illegally single-sourced.

A Treasury press statement dated 28 February 2019, signed by one of the accused, former Cabinet Secretary Henry Rotich claims that the financing agreement for the two dams was “government-to-government” with the Italian government—represented by the 100 per cent owned Servizi Assicurativi Del Commercio Estero (SACE)—providing “insurance cover and financial support” amounting to close to 88 per cent of the total loan amount, with a consortium of four banks led by Intesa Sanpaolo said to provide the rest. The statement details “the Conditions Precedent”, which were payments apparently required before funds could be released to the government and the contractor. These include €7.83 million (Sh951 million) in fees and commissions and €94.2 million (Sh11.4 billion) in credit insurance to cover lenders for both dams. In addition, another US$75.2 million (Sh9 billion), or 15 per cent of the total contract sum for both dams was paid out to the contractor.

The Kenyan public paid to insure the banks against government default, which insurance the ODPP says was illegally single-sourced.

The Treasury claims these fees and advances were provided for and paid from the loan from SACE and the banks, not Exchequer funds. This aligns with a November 2019 note by SACE to the Italian foreign ministry which states that the agreement required the “payment of the sums due by the Contracting Authority to the CMC-Itinera joint venture through direct disbursement by the lenders on a current account of the contractor opened outside the State of Kenya” —a violation of the Kenyan constitution which requires all sums borrowed by the government to be deposited in the Consolidated Fund. However, according to both CMC-Itinera and a confidential analysis by the ODPP seen by The Elephant, the advance payment was for a total of €66.6 million (Sh8.09 billion), a discrepancy of nearly Sh1 billion. (It should be noted that the National Treasury appears to have entered into a facility contract with lenders in Euros, and payments appear to have been made in the same currency, even though the commercial contracts were in US dollars, which exposed taxpayers to losses through changes in the exchange rates. In this article, we have used the current exchange rates to reflect the amounts in Kenya Shillings.)

Further, according to business journalist Jaindi Kisero, SACE does not appear in the external debt register which raises doubts as to whether they were indeed the main lender. Also, the November 2019 note by SACE to the Italian foreign ministry says the insurance guarantee was “in favor of the Lenders for the entire amount financed”, which seems to say that all the money came from the banks. The ODPP analysis says that while the agreements make it clear that SACE was one of the financiers, the agency did not act as a party to them. It argues that the insurance premium was fraudulent because if the funds came from SACE, as the agreements suggest, it would have been a government-to-government loan which would require no insurance. It concludes that “payments made by GoK were made with the intention to siphon money from the country in the disguise of advance payment, insurance premium and commitment fees”.

Deputy President Ruto has claimed that only Sh7 billion was in question and that the government had a bank guarantee that protected every penny. The Treasury statement seems to back him up, at least as far as the guarantee is concerned, claiming the advance payment was backed by “a bank/insurance guarantee” which would be called “if the contractor is unable to deliver the service to the Government or runs bankrupt”. And in February 2022 Regional Development Principal Secretary Belio Kipsang told Parliament that Heritage Insurance and Standard Chartered Bank had respectively issued insurance guarantees for the advances paid to the CMC Ravenna-Itinera joint venture for Arror (Sh4.1 billion) and Kimwarer (Sh3.6 billion). He said the government had already recalled the Arror guarantee and was planning to do the same regarding Kimwarer, whose guarantee expires in June 2023. However, it is again unclear from his statement what currency the guarantees are in: dollars, euros or shillings. If in shillings, then it seems that up to Sh1.3 billion may not be covered.

The ODPP analysis says that while the agreements make it clear that SACE was one of the financiers, the agency did not act as a party to them.

It is unclear exactly how much Kenya stands to lose given the discrepancies in the currencies used. In total, according to the ODPP, €168.5 million (Sh20.5 billion) was paid between 4 May 2017 and 7 November 2018 to cover the insurance premium, various fees as well as the advance payments. The statement from the Treasury, as noted above, puts this figure at €102 million and US$75.2 million for a total of Sh23.5 billion at current rates. In addition, the external debt register lists Kenyans as being on the hook for the entire loan amount of €578.4 million (Sh70.3 billion) which stands to be repaid until November 2035. Yet it does not seem that any further disbursements have been made by the banks to the companies beyond the insurance premium, fees and commissions and the advance payment. Why the full loan amount would be reflected as drawn down in the debt register is a mystery. It is also noteworthy that Kenya has refused or failed to make any repayments on the moneys already disbursed.

The cases at the Milimani Anticorruption Court provide few concrete answers. There are currently two cases, consolidated from the initial four—two cases for each dam dealing separately with charges of financial and procedural irregularities. Each of the four initial cases had numerous defendants including directors of companies based in Italy who refused to come to Kenya to take plea, occasioning long delays. Eventually, all the cases were consolidated into two, with Case 20 of 2019 having 8 accused persons based in Kenya, and Case 21 of 2019 dealing with the alleged crimes of 18 Italian individuals and companies. This arrangement has allowed the Kenyan cases to proceed with the first witness out of 57 taking the stand in November last year.

One strange thing about the cases filed by the ODPP is that while they allege a conspiracy to defraud the government through the commercial agreements, there is little indication of the other side of that coin: how did the individuals involved benefit from the scheme? No one is charged with paying or receiving a bribe and there has been little evidence produced so far to warrant the many press allegations of corruption and kickbacks. According to a report in the East African Standard, Sh450 million was “wired by the Treasury to Italian firm CMC di Ravenna . . . was sent to an account in London then Dubai and later to Nairobi”. One of the report’s writers, Roselyne Obala, would later add that the same Sh450 million was part of a larger payment of over Sh600 million and that it was paid to an account in Barclays Bank in Nairobi. However, none of this is in the charges preferred at the Anti-Corruption Court. Further, it is unclear whether “over KSh600 million” refers to the much larger advance payments which, in any case, was (illegally) transferred directly by the banks in London to the companies. Further, the absence of prosecutions within Italy, which has a law criminalizing Italian companies paying bribes to public officials abroad in return for contracts, suggests that there is no evidence that a bribe was paid in this case.

There have been allegations raised that the prosecution of the dam cases was politicised, targeting allies of Deputy President William Ruto. In October last year, Rotich instituted a petition at the Milimani High Courts questioning why the DPP left out key personalities involved in the tendering process such as the former Attorney General Githu Muigai, solicitor general Njee Muturi and former Environment CS Judi Wakhungu. Rotich has also argued that he was not responsible for procurement of the tenders and was not the accounting officer at Treasury. “It is absurd that the respondents chose to charge me while the Attorney General is not charged in this respect. This is an indication of selective prosecution that cannot stand the test of objectivity and fair administration of action,” he argued in the petition. Others have pointed to the dropping of charges against members of the KVDA Tender Committee as well as some of Rotich’s co-accused, former Treasury PS Kamau Thugge and Dr Susan Koech, a former PS in the Environment Ministry, as proof of malicious prosecution.

It is also noteworthy that Kenya has refused or failed to make any repayments on the moneys already disbursed.

Regarding the latter accusation, it is notable that many of the former accused have actually become witnesses so it may just be a case of the DPP using the small fry to net the “big fish”. However, when it comes to why the former AG, the solicitor-general, and the various ministers who oversaw KVDA between 2014 and 2019 are not in the dock, the answers are not so convincing.

A bigger source of discontent is the lack of similar prosecutions over similar projects. For example, the contract over the Itare Dam in Nakuru, also in the Rift Valley, features the same set of characters—SACE, CMC di Ravenna, Intesa San Paolo, BNP Paribas—and was the first dam awarded to the Italians in 2014. After advance payments of Sh4.3 billion were paid out, the project appears to have collapsed. As Nakuru Senator Susan Kihika noted in February 2019, “It . . . seems as if there is no equal treatment of all the projects across the country.”

In 2013, CMC had signed a consultancy contract with Stansha Limited, owned by Stanley Muthama, the MP for Lamu West, in which Stansha pledged to help CMC in its bid for tenders for the construction of Itare Dam, which is under the Rift Valley Water Services Board, and Ruiru II Dam under the Athi Water Service Board, for a fee of 3 per cent of the contract value. For Itare, it came to Sh330 million. According to the ODPP analysis, on 25 November 2015, a Stanley Muthama identified as “Staff CMC Kenya office” participated in a high-level “clarification meeting” with KVDA officials regarding the tender for the Arror dam, one of the decisive meetings for the award of the contract. Among those at the meeting were Paolo Porcelli and Gianni Ponta, two CMC officials the ODPP has charged, among others, for having “conspired to unlawfully have the services of CMC di Ravenna-ITINERA JV procured by KVDA for the development of Arror and Kimwarer multipurpose dams”. There is however no Stanley Muthama being prosecuted by the ODPP in the Kenyan case and no suggestion of any wrongdoing with regard to the contracts.

There, however, seems to be a pattern emerging where CMC di Ravenna—which has been in economic turmoil for four years; in 2018 it owed creditors €1.5 billion euros—receives advance payments for projects it does not thereafter complete. In Nepal, a US$550 million contract for the construction of a hydroelectric plant was terminated in 2019 and the company ordered by an Italian court to return €15 million to a bank in Nepal that had financed the project. CMC had not warned the Nepalese bank of its financial problems and had not even begun the work.

In Kenya, though, the two Italian firms have also claimed the cases were politicised and lacked grounds. In December 2020, they filed a suit at the International Court of Arbitration at the International Chamber of Commerce claiming they were victims of power politics between President Uhuru and his deputy William Ruto. They alleged that the cancellation of the tender was a ploy to weaken Deputy President Ruto’s 2022 presidential aspirations and are demanding US$115 million (KSh13.7 billion) in compensation for the cancellation of the contracts.

A bigger source of discontent is the lack of similar prosecutions over similar projects.

“It seems hardly coincidental that the highest ranking official to be investigated and charged in the criminal proceeding is Kenya’s Treasury CS Mr Henry Rotich, an ally of Mr Ruto,” stated the court document as reported in Business Daily. They claim that allegations of impropriety did not surface until two years after the contracts were signed and that KVDA had admitted that the projects had been politicised with an intention of terminating them.

In notes sent to the Italian Foreign Ministry, the joint venture complains of “delays in the payment of fees [by Kenya] to the Agent Bank with the risk of blocking future disbursements”. The companies blame the failure of the project to get off the ground on the failure by KVDA to deliver the necessary land, a claim repeated by Deputy President Ruto during the presidential debate in July. They also claim that import permit exemptions had not yet been issued.

President Kenyatta has also reportedly tasked AG Paul Kihara and Head of Public Service Joseph Kinyua to negotiate with the joint venture to seek an amicable settlement although it is curious that Kenya would seek to pay off the very companies it accuses of conspiring to defraud it. The country has, however, trodden this route before. In 2014, President Kenyatta ordered payment of Sh1.4 billion to briefcase companies for termination of contracts to supply telecommunication equipment and bandwidth spectrum, part of the Anglo Leasing scam where billions were paid to fictitious companies for security-related contracts.

Further, in May last year, SACE wrote to the AG, the Treasury and the Ministry of Foreign Affairs saying that Kenya could get a partial refund of its insurance premium but only if it committed to paying off the banks on whose behalf the country had taken out the policy. And the letter included a not-so-subtle hint that Kenya’s relationship with Italy was on the line.

They alleged that the cancellation of the tender was a ploy to weaken Deputy President Ruto’s 2022 presidential aspirations.

In brief, it seems clear that there were serious irregularities during the tendering and contracting for the two dams. KVDA tendered the projects under the PPA for a concessional arrangement but awarded a commercial contract under the Public Procurement and Disposal Act to a legally different entity from that which had won the tender without beginning the process afresh. Further, the arrangements to transfer money directly from commercial banks to the contractor seem clearly illegal and the shift from a concessional arrangement to a commercial one probably means Kenyans ended up paying more—including for unnecessary insurance. However, no money appears to have been paid out directly from the Exchequer, although the fees, commissions and advance payments have accrued a debt of up to Sh23.5 billion (at current exchange rates), less than a third of which may be covered by bank/insurance guarantees. Assuming the debt register is mistaken when it lists the entire loan amount, and that the guarantees by Standard Chartered Bank and Heritage Insurance are eventually honoured, Kenyans would still be, when we eventually get round to paying it, out of pocket by around Sh13.5 billion, the sum of the insurance premium (part of which we may get back), the various fees and commissions, and the exchange rate costs. As noted, no one has been accused of actually pocketing bribes. It also does not seem like either Kenya or the banks are pursuing a refund of the money paid to the joint venture in the Italian courts.

The biggest obstacle to a clearer understanding of what is happening with regard to the Arror and Kimwarer dams is the political whirlwind around it. Adding to the confusion is the language employed—terms like scam and kickbacks—suggesting that the officials involved pocketed bribes, whereas they are not actually accused of any of that. Further, journalists have tended to report the story much like the proverbial blind men of Hindustan—each accurately describing a part of the elephant’s anatomy, but not able to grasp the entire animal., It is to be expected that, even after the general election, the controversy surrounding the Arror and Kimwarer dams will continue to generate more political heat while shedding very little light.

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