Former Governor Awiti on spot over Sh194 million fraudulent deal with KRA

 

When former Homa Bay Governor Cyprian Awiti handed over the instruments of power to Gladys Wanga after her swearing-in -n on August 25, 2022. [James Omoro, Standard].

Former Homa Bay Governor Cyprian Awiti’s administration is on the spot over its conduct a few days before the August 9, 2022, General Election.

The Senate Public Accounts Committee said Awiti and his administration might have entered into a deal with the Kenya Revenue Authority that cost the county millions of shillings before election day

The Committee raised a red flag over a suspicious deal with the tax man worth Sh194 million that was entered into just a day before Governor Gladys Wanga was sworn into office on August 25, 2022.

The Committee chaired by Homa Bay Senator Moses Kajwang was told that the questionable deal was entered after KRA demanded Sh602.2 million in penalties and interests after failing to remit statutory deductions worth Sh1.36 billion.

Governor Wanga who appeared before the committee in Nairobi on Wednesday said that she was not aware of the negotiations with KRA since they were never mentioned during the transition and only came up after her swearing into office.

“My administration is now required to pay Sh43 million in penalties after a fresh negotiation with KRA reduced the amount from Sh194 million, an amount that could have been avoided had the previous administration remitted deducted statutory benefits from staff,” said Wanga.

Wanga told the committee that there was a lot of hurry to do things during the temporary incumbency period and that it was curious that the previous administration entered negotiations with the taxman during the transition period, even appointing a tax law firm to lead discussions.

She said there was a clear disconnect between what was presented in the handover report and what her administration later found out and that most of the reports were done just for the sake of beating deadlines with some being done during the transfer window.

Senator Kajwang’, however, called for the surcharging of county officers involved in what he termed as financial malpractice with those culpable supposed to be taken to court arguing that Sh43 million cannot be wished away due to errors of omission by some individuals.

The previous administration also left behind Sh1.2 billion worth of pending bills which the current administration only found Sh272 million to be legible, Sh534.2 million ineligible and Sh419.9 million requiring further action such as site visits for confirmation.

“Now that we have learned some very critical decisions affecting the county were made before you were sworn into office, it could also mean that pending bills in the county were most likely done at the time leaving the county reeling in debts,” said Kajwang.

According to Wanga, some contractors could not present proof of contract with the county government during the pending bills verification process with people bringing in a lot of documents but could not provide a contract between themselves and the county government.

She said the county has been left with questionable Sh171 million in legal fees accrued as a result of negligence where contracted lawyers did not enter court appearances with the devolved unit also operating without a county attorney since 2013.

Wanga said she found many of the legal pending bills inadmissible with some law firms claiming millions despite having no case won in court and that they are even contesting some legal fees cleared by the auditor-general.

“My administration has hired a county attorney, four principal legal officers, two legal officers who are in the process of getting a county solicitor so that we can ensure that we reduce the need to engage external legal firms over matters that can be handled by the county,” said Wanga.

The previous regime was also put under scrutiny over the irregular  hiring of 1,240 new staff in a year without approval for such recruitment, no advertisement or staff establishment for the same with move leaving the county with an unsustainable wage bill.

“The county was left with a wage bill of Sh4.09 billion, representing 53 percent of its Sh7.7 billion total revenues, increasing from the previous 37 percent, there was a sharp rise in the number of staff as we approached elections but we are dealing with the situation as we have conducted an audit of our personnel with 759 people affected,” said Wanga.

Kisii Senator Richard Onyonka wondered why the county voided transactions worth Sh529 million saying this cannot be done without due process, with this not being a reconciliation issue but a case of altered beneficiaries and approvals where people get paid for what they did not do.