Auditor-General Nancy Gathungu has raised concerns about Kenya Power’s governance in relation to the substantial exit payment of KES 26.82 million to former Managing Director Bernard Ngugi, who abruptly resigned in August 2021.
Gathungu’s examination highlighted the lack of approval for the payment from the State Corporation Advisory Committee (SCAC), a mandatory step according to legal stipulations. While nods from the Ministry of Energy and the National Treasury were obtained in 2022, SCAC’s clearance, a crucial requirement, was bypassed before the gratuity payout.
Pointing out contradictions in the utility’s staff regulations, Gathungu revealed that employees resigning before contract completion should not be entitled to gratuity or terminal leave pay. Ngugi’s premature exit, 15 months before his contract term, raised questions about the circumstances surrounding his departure.
The Auditor-General emphasized the irregularity of a portion of the payment, noting the incongruity of allocating KES 2.52 million as payment in lieu of notice, a sum inconsistent with Ngugi’s resignation without prior notice, which would warrant payment to the company instead.
Gathungu’s revelations suggest a hasty exit for Ngugi, indicating potential external pressures for leadership changes at Kenya Power. Subsequent appointments of acting managing directors, including Engineer Rosemary Oduor and Geoffrey Muli, further fueled speculation. The recent appointment of Dr. Joseph Siror as substantive managing director, almost two years after Ngugi’s exit, has signaled stability at the helm.
Dr. Siror, formerly overseeing technical services at Kenya Electricity Transmission Company (Ketraco), assumed the leadership mantle at Kenya Power, succeeding Ngugi, who took charge in October 2019 amid the utility’s financial challenges.
The Auditor-General’s report has raised governance concerns, spotlighting procedural irregularities in Ngugi’s exit. These revelations provoke inquiries into the circumstances surrounding his departure and draw attention to governance practices within Kenya Power’s executive leadership, signaling a call for enhanced transparency and adherence to regulatory procedures.
