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State Capture: The Institutionalisation of Impunity in Kenya

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The 2010 Constitution promised a brave new Kenya with clean, robust, and efficient institutions. But this promise never materialised. WACHIRA MAINA shows how state institutions, including electoral and judicial bodies, have been deliberately weakened by a system designed to protect the corrupt.

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State Capture: The Institutionalisation of Impunity in Kenya
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As Dominic Burbidge argues in The Shadow of Kenyan Democracy, the point of the aggressive avarice of Kenya’s corrupt leaders is to maintain power and privilege. This depends not just on the effective control of the Presidency and the Treasury but also on a repurposing of the machinery of government into a “temporary zone for personalised appropriation”.

The object of this repurposing’ is to gut state resources for electioneering and thus maintain power. In this dispensation, politics is a zero-sum game of “competitive aggression” in which “the principal victim” is “the state itself” and politics is “a pursuit requiring ever faster forms of enrichment”. For state capture to succeed, four things must happen.

One, oversight institutions must be eviscerated and hollowed out. This means that the offices of Controller of Budget, the Auditor General, the Kenya National Commission on Human Rights and parliamentary committees must be totally compromised and wholly ineffectual in their oversight.

Two, law enforcement and rule of law institutions (the police, the judiciary, the Ethics and Anti-Corruption Commission and the prosecution agencies) must be weakened or captured and redirected as “weapons” with which to fight political opponents.

Three, the ordinary channels of political change and accountability through periodic elections must be blocked, either by compromising the electoral management body (EMB) or through violent intimidation of political opponents.

Finally, the space for countervailing institutions to function, especially civil society and the media, must be shrunk until these pose no threat to capture. Alternatively, these institutions are also compromised and redirected to the state capture agenda.

Capture technique 1: A compromised electoral management body

In the early 1990s, the primary method for controlling the electoral process was through use of public order laws, such as banning public meetings, arresting and detaining regime opponents, and control of the EMB through the President’s power to appoint commissioners. Once appointed, the commissioners were nominally independent, but were almost immediately compromised by being allowed to draw illegal payments and allowances.

A 1996 analysis of the Controller and Auditor General’s Report for 1993/1994 by the Institute of Economic Affairs showed that the chairman and commissioners of the Electoral Commission of Kenya (ECK) had been paid Sh38,443,800 (equivalent to Sh375 million today) in sitting allowances, subsistence allowances and accommodation. They were paid whether they were on duty or not, even on public holidays. They had also been allowed to use privately registered cars that had no work tickets.

Following the interparty parliamentary group reforms of 1997, opposition parties could nominate commissioners, which expanded the composition of the ECK. In theory, this should have made the ECK more independent, but there were two problems. First, the opposition, like the ruling party, appointed reliable political operatives in the expectation that they would protect its interests in the commission. Second, once the commissioners were in place, they realised they were independent of their appointing parties and that they had unlimited opportunities to “sell” their discretion and judgment to the ruling party. The result is that since 1997, the diversion of funds and fraudulent spending at the electoral management body has ballooned, not subsided.

As an AfriCOG study shows, between 1991 and 2007, the ECK received Sh15.8 billion to run elections. Of this amount, Sh1.9 billion was paid out to commissioners in irregular payments and allowances, unaccountable vehicle hire, unsupported and wasteful expenditure, and imprests that were not accounted for.

Yet huge as these amounts are, they are nothing compared to the wastefulness of the Interim Independent Electoral Commission (IIEC) and the Independent Electoral and Boundaries Commission (IEBC). If before 2007 corruption in the ECK entailed trimming and larding expenditure heads within the budget, the period since has been characterised by open and rapacious greed that is proportionately matched by a sharp deterioration in the quality of elections.

As an AfriCOG study shows, between 1991 and 2007, the ECK received Sh15.8 billion to run elections. Of this amount, Sh1.9 billion was paid out to commissioners in irregular payments and allowances, unaccountable vehicle hire, unsupported and wasteful expenditure, and imprests that were not accounted for.

That claim is quickly demonstrated. Following the post-election violence in 2007/2008, the Independent Review Commission (IREC), better known as the Kriegler Commission, recommended wide-ranging reforms to address what it described as institutionalised impunity. Yet, within months of Kriegler’s recommendations, the successor to the ECK, the IIEC, had reverted to type, becoming embroiled in corruption on a scale that the ECK had not touched. From that moment on, the EMB would not rely on illicit payments from the government; commission staff would rig the commission’s procurement processes to enrich themselves, knowing well that they would not be prosecuted or called to account if in the process they helped the ruling party.

In this first procurement scam, senior officials of the EMB were paid handsome kickbacks by Smith and Ouzman, a security printer based in the United Kingdom whom they had contracted for the purchase of electoral materials. In a subsequent UK criminal trial for corruption, it emerged that the officials of the company had paid up to £349,057 in bribes (over Sh45 million today, referred to as “chicken” by IIEC officials and commissioners) to secure the contract for the printing of materials for the by-elections following the 2007 election and the 2010 referendum. In return for these payments, IIEC provided Ouzman with information on rival bids to enable the company to inflate printing costs. Many IIEC officials, including the chair, Issack Hassan, were lavishly entertained by Ouzman during visits to the UK.

But “chickengate” was nothing compared to the wanton procurement corruption perpetrated by the new electoral commission, the IEBC, in 2013. Every item bought for that election was corruptly procured. The principal procurement for the electronic voter identification devices (EVID) was so tainted that the Public Procurement Administrative Review Board (PPARB) would have cancelled the contract were the election not so close.

The Board was giving its decision in Avante International Technology Inc. and 2 others v. The IEBC. The case had come before the Board on the main ground that the IEBC had ignored professional advice and awarded a tender worth $16,651,139.13 (Sh1,397,724,925.51) to Face Technologies, a South African company. To do this, the IEBC had unlawfully revised an unresponsive bid by Face Technologies to make it legal. In the words of the PPARB, the IEBC had been inexplicably “magnanimous in interpreting its tender documents” in favour of Face Technologies. The IEBC had not only acted with impunity, it had from the very first been “bent on awarding the [EVID] tender to Face Technologies”. In the Board’s view, the IEBC was “waving the card of public interest as its defence in the various breaches of the procurement law”.

But “chickengate” was nothing compared to the wanton procurement corruption perpetrated by the new electoral commission, the IEBC, in 2013. Every item bought for that election was corruptly procured.

The Board said that under different circumstances, it “would have [had] no hesitation [annulling] this tender”. However, it would not do so here because that would “certainly jeopardise the holding of the forthcoming general elections”.

The IEBC’s conduct was so egregious, that the Board recommended that the “Director General of the Public Procurement Oversight Authority carry out investigations pursuant to powers conferred by section 102 of the ACECA and take appropriate action”. A special audit on the procurement of electronic voting devices for the 2013 general election by the IEBC ordered by Parliament would later prove that what the PPARB had found in the pre-election litigation was just the tip of a monstrous iceberg. It turned out that all electronics purchased for the 2013 election had been procured irregularly.

The audit found that biometric voter registration kits had also been bought irregularly. Though the Treasury had appropriated money for this procurement, the IEBC had inexplicably borrowed commercially to buy the kits. This unusual method, which echoed some of the elements of the Anglo Leasing scandal, meant that the taxpayer would pay fees and interests that ought not to have been paid. More illegalities were committed in procuring the results transmission system. The system was never inspected on delivery, leaving its functionality doubtful on election day.

On receiving the audit report, the Public Accounts Committee was so outraged it recommended an anti-corruption audit and criminal investigation of all IEBC commissioners, the committees, and of the CEO James Oswago who, in addition, they said should not only be barred from holding public office but also surcharged for paying out Sh258 million to Face Technologies without a contract.

None of these recommendations were implemented, although Oswago was replaced in 2015 by Ezra Chiloba. Most scandalous, however, were the “hefty” undisclosed amounts that the IEBC commissioners were paid at the end of 2016 for “agreeing” to retire early to pave way for reforms ahead of the 2017 election. This sweetheart deal, put together by a bipartisan committee of Parliament, signalled that impunity would be rewarded rather than punished. Though the sums were not made public, the commissioners had argued that they were entitled to all their forward pay if they were going to leave before the end of their terms.

That deal set the tone for the behaviour of the IEBC in 2017. Their attitude is already foreshadowed by their response to the recommendation of the Ethics and Anti-Corruption Commission (EACC) that the electoral management body bar 106 candidates for governor, MPs, and members of county assemblies from contesting the August 8 elections as they were unfit to hold office. None of the 106 were barred and 60 per cent of them were eventually elected.

No external audit has been done on the 2017 procurement, but an August 2018 IEBC internal audit of the 2017 general election provides damning evidence of how corrupt the electoral processes were. The internal audit reviewed 31 contracts worth Sh6.2 billion that the commission had signed. The auditors feared that taxpayers had not received value for money in ten contracts worth Sh4.6 billion.

As with previous corrupt dealings at the IEBC, the culprits were CEO Ezra Chiloba (suspended in 2018), the directorates of finance, ICT, supply chain management and legal and public affairs. The proposal to carry out the audit had generated serious internal conflict, forcing the commission to send its CEO, Mr Chiloba, on compulsory leave to allow for “a comprehensive audit of all major procurements relating to the 2017 general and fresh presidential elections”. Shortly thereafter, three commissioners – Consolata Maina, Paul Kurgat and Margaret Mwachanya – announced that they had no confidence in Mr Chebukati, the chair, and were resigning from the IEBC. They would later rescind their resignations.

As with the Smith Ouzman and Face Technologies cases, the IEBC seemed hell-bent on contracting particular firms. For example, the audit showed that the IEBC had awarded Safran Identity & Security a Sh2.5 billion contract to supply election technology for the repeat presidential election of 26 October 2017 on a Sh423.6 million performance guarantee that had expired two months earlier. At issue was not just the additional Sh2.5 billion contract that Safran Morpho received for the October 26 re-run, but also a further contract to reconfigure the 40,883 Kenya Integrated Elections Management System kits it had supplied for the August election.

Not surprisingly, Safran made hay while the irregularities sun shone. The IEBC paid Sh2.5 billion for the Safran system, two-thirds of what it had spent on the six elections involved in the August general election. Safran charged the IEBC Sh443.8 million for election day support, nearly double the Sh242.5 million it had paid for the same support in the general election. The internal audit concluded that a sum of Sh384.6 million that IEBC paid Safran for “programme and project management” was unnecessary and therefore wasteful.

As with the Smith Ouzman and Face Technologies cases, the IEBC seemed hell-bent on contracting particular firms. For example, the audit showed that the IEBC had awarded Safran Identity & Security a Sh2.5 billion contract to supply election technology for the repeat presidential election of 26 October 2017 on a Sh423.6 million performance guarantee that had expired two months earlier.

As in the 2013 election, many aspects of technology acquisition were corrupt and highly irregular. Airtel was contracted to supply 1,553 units of Thuraya IP SIMs loaded with data bundles for the results transmission system in the areas without 3G and 4G networks – 11,115 polling stations in all. The company could only supply 1,000 by election day. The additional 553 units were supplied after the election.

Oracle Technology Systems (Kenya) Ltd provided database and security solutions at a cost of Sh273.6 million without a signed contract. Scanad Kenya Ltd got the contract for the IEBC’s “strategic communication and integrated media campaign consultancy services”, even though its price was more than twice the Sh350 million budget earmarked by the IEBC. Africa Neurotech was contracted to install IEBC data centre equipment at a cost of Sh249.3 million, an amount almost double the IEBC budget of Sh130 million. The data centre equipment was not ready on election day.

Further details about the extent of impunity within the IEBC come from the lawsuits filed against it concerning the procurement of electoral equipment and materials just before the elections. In early 2017, the IEBC single-sourced Safran Morpho to provide election equipment, the same controversial French company with which the IEBC had negotiated a tripartite agreement to buy biometric voter registration (BVR) kits for the 2013 election. As in 2013, the IEBC argued that its single-sourcing decision was necessitated by the limited time left to comply with the election timetable, a problem that they said had been compounded by interminable litigation. Safran Morpho has a chequered history and due diligence might have ruled them out. In the USA, its subsidiary has been accused of misrepresenting the firm’s track record. In 2013, Safran was fined $630,000 by a French court after being found guilty of bribing public officials in Nigeria to win a Sh17 billion identity cards tender.

Given these experiences, the inevitable question then is: why are electoral management bodies in Kenya allowed to be this unaccountable? Who benefits from a criminalised EMB? The answer lies in the ability of the EMBs to give “state capture” formal legitimacy: so long as the country goes through the formalities of an election that international observers can say “broadly reflects” the will of the people (whatever that means), electoral management bodies can be rapacious in cannibalising their budgets and the governments they help put in power can be trusted to look the other way.

Capture technique 2: Undermining law enforcement

Effective law enforcement institutions, especially an effective and honest police service, a functional, independent and accountable judiciary, and a professionalised office of the Director of Public Prosecutions (DPP), are central to fighting corruption effectively. None of these institutions are wholly accountable or fully functional. The police remain unreconstructed and, if the evidence revealed by the police vetting exercise is anything to go by, also unrepentant.

The office of the DPP has been haphazard in prosecuting; it appears to be picking cases for prosecution for reasons that appear patently political, fumbling cases involving the “big fish” and generally being assiduous on those that involve “small fry”. The judiciary seemed on the mend after 2010 when the new constitution came into force but since then things have gone awry: judicial vetting failed to fully root out corruption, bribery has crept back and though some of the excesses of the past have not returned, a clean judiciary is still a long way off. On the whole, the government’s attitude to law enforcement is consistent with the logic of state capture: control and compromise the police and the DPP and weaken the harder-to-control judiciary.

The police: A vertically-organised criminal syndicate

It serves state capture if politicians are wilfully blind to police corruption. In Kenya, police “palm greasing” at traffic stops is so routine that drivers arrive with the bribe already folded, ready to be slapped onto the palm, or slipped into the pocket of the traffic cop. Presidents are often excused from the predations of the police but their responsibility and that of their government was explained many years ago by William of Pagula: “For, one who permits anything to take place that he is able to impede, even though he has not done it himself, has virtually done the act if he allows it.”

The stability of state capture rests on uniting the interests and fates of low-level operatives with those of their bosses. In the case of the police, recruitment into the police service is a grant of a preloaded cash machine. This, in part, is what the recent police vetting revealed. The vetting proved that what Sarah Chayes observed of Afghanistan is true of Kenya, namely that the conventional wisdom that corruption involves doling patronage downwards to juniors is wrong-headed. Instead, it is subordinate officials who pay off the top in return for “unfettered permission to extract resources for personal gain, and second, protection from repercussions”. The critical point is that this whole system depends on “faithful discharge, by senior officials, of their duty to protect their subordinates” and this implicit contract holds, “much as it does within the mafia, no matter how inconsequential the subordinate might be”.

The mechanics of police corruption can be seen in the police vetting exercise undertaken by the National Police Service Commission (NPSC). As one newspaper account sarcastically noted, top cops often seemed hard pressed to cite a major crime bust but the state of their bank accounts showed them to be men of great business acumen, a fact that would alone “put Kiganjo Police Training College at par with the region’s top business schools in producing entrepreneurs of note”.

The stability of state capture rests on uniting the interests and fates of low-level operatives with those of their bosses. In the case of the police, recruitment into the police service is a grant of a preloaded cash machine.

Officers’ bank records show deposits of hundreds of thousands of shillings monthly, mostly from “businesses” that they and their spouses own or from “convenient” sales of assets that they previously owned. Many were Jacks of all trades, running businesses that run the gamut from chicken farming, residential and commercial rentals and fish farming.

That no major shakeup of the police has followed from this much-publicised vetting shows that this high profile “stagecraft” was cynical “busywork” (both Chayes’ words) to manage the expectations of a disillusioned public. So, in the end, a hapless public finds itself caught between an abusive police service and a predatory government of which it is an accomplice. The police vetting process eventually petered out and left in its wake as much confusion as the interest it had piqued. Many of these entrepreneurial officers are still in the police force, still pursuing their sprawling business interests. Who benefits from a compromised and corrupt police force?

Anti-corruption commissions a waste of public money

Since President Uhuru Kenyatta announced his new anti-corruption drive, the Ethics and Anti-Corruption Commission (EACC) has become busy. However, neither the EACC nor its forerunners have demonstrated the will to fight corruption. Since its establishment under the 2010 Constitution, the EACC has never exercised the authority that Kenyans would like to see it exercise. Some of the problems of its ineffectiveness have to do with its own sloppiness: poor investigations, underhand investigatory methods and a penchant for the dramatic gesture. That has also been compounded by lack of political support and internecine conflict between the commission and the office of the DPP.

The combination of its own weaknesses and lack of political support means that the EACC is rarely taken seriously. As already noted, its 2017 recommendation that the IEBC bar 106 candidates was ignored. The EACC blames the IEBC for this debacle; in truth, both commissions have been ineffectual and are often implicated in corruption themselves.

The modus operandi of the EACC, which has damaged its credibility and undermined its ability to lead the fight against corruption, is to launch an investigation in the glare of publicity and make sweeping claims that it is generally unable to later substantiate. The question is why successive anti-corruption commissions have been allowed to continue operating in this manner. The answer is another question: who benefits from this?

The judiciary: Partly reformed and easy to sway for state capture purposes

As the ill-fated indictment and prosecution of Kamlesh Pattni in the 1990s Goldenberg scandal showed, the judiciary was a central pillar of the repressive and corrupt dispensation replaced by the 2010 Constitution. By the year 2000 the judiciary was universally condemned as both corrupt and incompetent. The few honest judges faced myriad problems: lack of research support; poor record keeping occasioned by insufficient stenographers and electronic recording devices; a huge and ever-growing backlog of cases; biased and politicised allotment of benefits to judicial officers, especially cars and houses; and highly politicised appointments and promotions awarded by the President, nominally with the advice of the Judicial Service Commission (JSC), but in practice, at his own discretion.

The combination of its own weaknesses and lack of political support means that the EACC is rarely taken seriously. As already noted, its 2017 recommendation that the IEBC bar 106 candidates was ignored. The EACC blames the IEBC for this debacle; in truth, both commissions have been ineffectual and are often implicated in corruption themselves.

Shortly after the election of President Mwaii Kibaki in 2003, the then Minister for Justice, Kiraitu Murungi, launched what he termed “radical surgery” – a high profile process of identifying and purging corrupt judges and magistrates from the judiciary. It soon proved neither radical nor surgical. The reforms were based on an investigation carried out by a former law partner of the justice minister. Thus, congenitally politicised, radical forgery failed to mollify critics who saw it as a Kibaki plot to remove President Daniel arap Moi’s judicial cronies to make room for friends of the new government, rather than a root and branch reform of Kenya’s decrepit judiciary. This criticism was overdone. However, the minister’s best intentions had no base in statute and without this radical surgery merely mortgaged judicial reforms to the factionalism that was then tearing apart the ruling coalition.

Eventually, over 80 magistrates and 23 judges were removed for corruption-related reasons, but by 2006 not a single judge had been found guilty by any of the many tribunals established to investigate them. In one particularly notorious case involving Justice Philip Waki, who would later lead the investigation into the 2007/2008 post-election violence, the tribunal was scathing about the methods that Justice Aaron Ringera had used: unsafe reliance on clearly unreliable witnesses; failure to talk to the affected judge and overlooking innocent explanations related to the claims made. More importantly, radical surgery left many judges in place who would be later be dismissed as unfit to hold office.

The result of this unsatisfactory purge was that there was still much left to do when the 2010 Constitution came into force. The constitution adopted a two-pronged approach to dealing with corruption and judicial failure. The first was institutional design and the second was vetting of incumbent judges and magistrates.

The institutional reforms reorganised the powers, functions and composition of the judiciary, strengthened the JSC and created a Supreme Court. Vetting was based on Article 23 of the Sixth Schedule to the Constitution and the Vetting of Judges and Magistrates Act. The aim of vetting was to clean up the judiciary, partly to create a more accountable judiciary by removing the bad apples and partly to provide a transitional justice mechanism that would eliminate institutionalised impunity.

Once it got going the vetting proved (as the police vetting was to subsequently prove) both ineffectual and inadequate; ineffectual, because the vetting mechanism was congenitally defective in that some aspects of vetting were challenged in court and heard by judges who were themselves yet to be vetted. It is not surprising then, that the effect of this litigation was to constrict the wide mandate and discretion initially given to the Vetting Board. In addition, the timetable for vetting was hopelessly optimistic and had to be extended several times through amendments to the law. The resulting legislative delays slowly punctured the Vetting Board.

In theory, the vetting helped to clean out the courts, but it is hard to know what to make of statistics. It seems as though there were, in effect, two vetting processes: vetting as understood by the Vetting Board and vetting as interpreted by the courts. One out of every three first instance decisions made by the Board was reversed on review in both the High Court and the Court of Appeal. Among the magistrates, about 45 per cent of the Vetting Board’s first instance decisions of unsuitability were reversed.

The Vetting Board would eventually run into more serious problems: the “scope of vetting” was dramatically reduced by the Supreme Court. The Supreme Court said that the Board could only vet judges and magistrates for conduct that occurred between the date of appointment and 27 August 2010, the day the 2010 Constitution was promulgated. This had far-reaching consequences. All the decisions of the Vetting Board that found judges and magistrates unsuitable on account of acts committed before they were appointed, or for acts committed after 27 August 2010, were effectively nullified.

The Board was now obliged to send all cases related to the post-August 2010 period to the JSC. In the end, judicial vetting never met its twin objectives of cleaning up the judiciary and fully restoring public confidence in the courts. That it failed to clean the judiciary explains the persistence of judicial corruption and resistance to reforms – periodically explained as “cartels fighting back”. That vetting failed to restore public confidence explains why the judiciary gets lukewarm public support when it is dismissed by politicians as “activist” or “captured by NGO or opposition interests”.

Why did vetting fail to achieve its purposes? To begin with, the vetting law was too restrictive. In retrospect, the law could have been more robust than it was. One of its main weaknesses was that it gave no immunity to people who had ever given or been asked for a bribe by a judicial officer. Without immunity from prosecution, witnesses had effectively been denied the means with which to prove corruption. That left the Board with the unenviable task of inferring bribery from unexplained deposits in the judges’ and magistrates’ bank accounts, very much like in the police vetting exercise.

Secondly, the Supreme Court’s formalistic reading of the Vetting Act (i.e. limiting the relevant period of acts committed between appointment and the constitution’s effective date) undermined the broad purpose of the statute, which was to remove undesirable individuals from the judiciary. That decision created more problems than it solved. One, it allowed judicial officers known to be unfit to continue in office, which itself was a serious blow to public confidence. Two, it introduced unnecessary unevenness – some might even say discrimination – into the vetting process for those who had already been vetted. Three, it saddled the JSC with what in effect were vetting decisions, thereby mixing transitional justice issues, which is what the vetting was about, with the core mandate of the JSC, which is more prospective.

Thirdly, it was wrong in principle that many aspects of the vetting process were litigated before judges who had not themselves been vetted, that is, before judges with a personal stake in limiting how deep and wide the vetting went. This eroded public confidence in the integrity of the vetting exercise although the reason for vetting in the first place was the need to restore public confidence in the courts.

Why did vetting fail to achieve its purposes? To begin with, the vetting law was too restrictive…One of its main weaknesses was that it gave no immunity to people who had ever given or been asked for a bribe by a judicial officer. Without immunity from prosecution, witnesses had effectively been denied the means with which to prove corruption.

Fourthly, the Vetting Board compounded its own problems. It decided that in deference to the seniority of judges of the Court of Appeal it would sit en banc, that is, as a full bench rather than in small panels of three, when it came to scrutiny of the judges of that court. The result was bizarre: the Board would sit in one capacity to vet a particular judge and if that judge was dissatisfied with that decision, he would then seek a review, which would be heard by the same full panel of the Vetting Board. Some lawyers saw no problem with this, arguing that the Board’s review power was no different from the power of an apex court to review its own decisions. Yet again, the question was whether the public would appreciate what seems on the face of it to be a rather otiose legal argument and whether this did anything for the public’s confidence in the vetting exercise.

The result of these partial measures is that the judiciary retains many of its bad old ways, which are now being used to undermine “the good guys”. The government now blames corruption in the judiciary as the greatest barrier to anti-corruption reforms, discounting the shoddy, compromised investigations often carried out by the police, and the ineffectual and often politically targeted prosecutions by the State Law Office. As with the other aspects of law enforcement, the question is: who benefits when the courts are perceived as compromised or untrustworthy?

Kenya’s anti-corruption efforts: Motion without movement

Given this analysis, it is clear that the latest anti-corruption efforts can be summarised as the “tried, tested and known-to-be ineffective” approaches of the past. This means that although it is good to have an energetic public prosecutor in office and that the EACC has bestirred itself, this won’t be enough. The lynchpin of the government’s approach to fighting corruption is, like the Goldenberg scandal, high profile arrests followed by quick indictments.

Some people are impressed that some big names have already been scalped: former Sports Cabinet Secretary, Hassan Wario, former Principal Secretaries Lillian Omollo, Richard Ekai and Richard Lesiyampe, present and former Kenya Power bosses Ken Tarus and Ben Chumo, Kenya Railways boss, Atanas Maina, chairman of the National Land Commission, Mohammed Swazuri and senior managers at the National Cereals and Produce Board. These arrests have generated much excitement but this excitement is premature. Kenya’s prosecution-driven anti-corruption strategy has always been rather benign; it is “capture-mark-release”, a bit like the ecological methods of estimating the population in an ecosystem. It is never meant to harm the corrupt.

This is Part 2 of an abridged version of State Capture: Inside Kenya’s Inability to Fight Corruption, a report published by the Africa Centre for Open Governance (AfriCOG) in May 2019.

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Wachira Maina is a constitutional lawyer based in Nairobi, Kenya.

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