Cane farmers now want audit report executed

Kenya: An audit report by KPMG on mismanagement and loss of billions of shillings at Mumias Sugar Company (MSC) has left farmers and staff at the one-time blue chip firm dumbfounded and now wants action taken urgently.

Despite government efforts to restructure the management, cane farmers and shareholders have accused elected leaders of maintaining studiously silence despite the exposé.

“As the investigations continue, some managers have quit their jobs,” said Dan Wameyo, chairman Board of directors.

Farmers at Lubinu on the Kakamega – Mumias highway have also claimed that despite the sacking of some managers, more heads must roll for MSC to completely get rid of corruption.

The farmers, who claimed that managers receive hefty salaries while they are paid peanuts, demanded that current and incoming directors take a pay cut.

Their sentiments were echoed by deputy secretary of the Kenya National Federation of Sugarcane Farmers, Simon Wesechere, who said the KPMG report was long overdue since the problems started a decade ago and called for prosecution those found culpable of misusing funds.

“This is what we have been crying for since 2008. We hope farmers’ problems will be solved through implementation of the report recommendations,” said Wesechere.

Kakamega Governor Wycliffe Oparanya concurred with the farmers, saying, ‘the former and current managers mentioned in the report must be taken to court and the company cash recovered.

“It is high time MSC reduced the number of managers, while those serving should be ready to accept pay cut,” he said.

Medical scheme

Religious leaders and other stakeholders have blamed the local leadership for failing to address the matter early enough before the company faced imminent collapse.

Silvanus Omwoma, a farmer from Mumias, claims he has not been paid since last April. “Corruption at MSC has dealt a big blow to farmers. The only gift to farmers is for the report to be implemented and leaders should stop politicising the issue,’’ says Omwoma.

Kennedy Echesa, former chairman Mumias Out-growers Company (Moco) said lack of political will has greatly contributed to the problems currently facing farmers and the company. He said former managers relied upon politicians to serve their interests.

“We began this battle in 2008 and forwarded our petitions to Ethics and Anti-Corruption Commission. We support the KPMG report fully and those culpable should be brought to book,’’ Echesa said.

 

However, he observed that chances of MSC survival are slim because its current assets stand at approximately Sh4 billion against a liability of Sh10.6 billion.

“The Government should move fast and bail out the company, however, from the look of things, MSC chances of survival are minimal because of the huge loss it has accumulated for almost a decade,” he added.

Moco has moved to court to claim Sh3.7 billion the company owes farmers. Echesa alleges that for the past 21 years, for every tonne delivered, farmers were deducted Sh6 to contribute to a scheme meant for a cane development project, that never took off.

Eight people, among them Nairobi Governor Evans Kidero and his successor at MSC Peter Kebati, were adversely mentioned in commercial, procurement and importation scandals that sunk Kenya’s biggest sugar miller to its knees.

Others mentioned are former business development manager Peter Hongo, former commercial director Paul Murgor, Finance director Chris Chepkoit, Warehouse manager Christine Cherotich and the national sales manager Fredrick Nzioki.

Vihiga Senator George Khaniri, said the Senate will look at the report keenly and if it merits, an adoption process will be conducted and urged relevant bodies to take action in orders for farmers’ cash in individual bank accounts be recovered.

Budalang’i MP Ababu Namwamba and Kakamega Senator Boni Khalwale, both vocal leaders from the region had also maintained silence since the KPMG findings were made public last week until they were reached for comment this week.

Khalwale said once adopted, relevant bodies, including Office of Public Prosecutor, EACC and Criminal Investigation Department must take action against individuals mentioned.

Khalwale and Ababu said they would initiate private prosecution if the government fails to act on the audit report.

“We shall pursue private prosecution if KACC, CID and DPP drag their feet. Managers mentioned should not hold any public office and their properties should be impounded, sold and the money used to revive the ailing sugar firm,” said Khalwale.

Ababu warned he would rally other local leaders to launch a legal battle against those implicated.

“It does not matter who they are, but the law must take its course because they are economic saboteurs. We are looking forward to the report in Parliament and we don’t want a game of musical chairs from the government as it has been the case with previous reports,’’ said Ababu.

Ababu said MPs will look at the report in Parliament irrespective of their party affiliations and employ their professional insights in dealing with it.

Drastic surgery

 

He argued that drastic surgery is needed at MSC, but complete overhaul may lead to victimisation of innocent people noting that a forensic audit should be conducted to determine staff who merit retention and those culpable to take personal responsibility.

“It should not be an overhaul that victimises innocent people because we may end up getting rid of brilliant brains. A forensic audit will help greatly in unmasking corrupt elements,’’ said Namwamba.

Khalwale and Oparanya regretted that selfish politics has derailed the company and some leaders are afraid to criticise corruption at the miller.

“It is sad that our farmers are being misused to defend people serving their own interests. We should stop politicising the sugar industry if we are to succeed because if the miller collapses the county and country’s economy will be affected,’’ said Oparanya.

Khalwale added: “Some local leaders are silent about the company because it’s alleged the managers might have supported some of them in their political campaigns. I will not keep quiet as our farmers are reduced to beggars ’’.

The Kakamega Senator asked the national government to transfer the 20 per cent shares they hold at MSC to the county government to ensure the miller is supervised well because the current leadership at MSC has failed to cooperate with the county government.