‘State parastatal jobs are spoils of war’

By John Njiraini

The recent path taken by Kenya Revenue Authority (KRA) to fill up its senior positions has ignited a sense of optimism in the management of State Corporations.

There is a feeling that due process will eventually be followed in the appointment of parastatal heads.

In an otherwise dark atmosphere where merit is shoved aside for cronyism in the appointment of chief executives of State corporations, there is white smoke from Times Towers.

KRA, undoubtedly a critical State corporation, recently advertised positions of Commissioner General to replace Michael Waweru and two other senior commissioners.

This is certainly a radical break from the perennial controversies that have followed -appointment of parastatal heads.

The placement of adverts late last month for the positions of the commissioner general and those of commissioners for domestic diagnosis taxes and custom services was thus a sign that order could prevail in the process.

But going by the controversies, chaos and confusion that have characterised the appointments of parastatal bosses in the past, its too early to assume the KRA process will be without blemish, especially considering the ethno-political interest the position of KRA commissioner general attracts.

Whether the KRA board chaired by Major (retired) Marsden Madoka manages to wither the intricacies of the process remains a matter of conjecture at this point.

What is clear, however, is that appointments of parastatal heads has become one of the most contentious and controversial issue characterised by political influence, ethnic balancing and profiling, cronyism, patronage and uttermost nepotism.

"Normally, there are so many vested interests that mar the appointments — he making it impossible to be smooth," says Jacqueline Mugo, Executive Director, Federation of Kenya Employers.

"Due to lack of an open and transparent recruitment process, ministers have taken advantage to appoint individuals who are friendly to them so that they can influence the running of the parastatals," she says.

Unlike during the Kanu regime when laid down procedures were blatantly disregarded in the appointment of parastatal chiefs, the pretence to adhere to procedure in recent years coupled by wielding of enormous powers by ministers has ensured appointments of parastatal bosses lacks any form of credibility as meritocracy is secondary to various interests.

Privatisation

This malady largely informed the Britton Woods institutions lead by the World Bank and the International Monetary Fund in late 1980s and early 1990s to compel the Kanu regime to privatise parastatals.

But going by controversies that characterise the appointment of nearly all parastatal chiefs, neither the semi-autonomous State corporations nor the wholly State-owned have been spared the charade.

"State parastatal jobs are spoils of war because they are viewed as money making entities," says Mars Group chief executive Mwalimu Mati.

"That is why merit and procedure does not count," he says, adding that the biggest calamity facing State corporations is failure to appreciate they are entities that can be run like other profit-making companies in the private sector.

Messy controversies

Currently, a number of parastatals are entangled in the messy controversies raising the question on why is it near impossible to appoint or re-appoint a parastatal head without generating dust?

At the National Environmental Management Authority (Nema), the process to appoint a director general has been bungled.

The board has found itself on the spot in the manner in which it carried out the recruitment that culminated in the short-listing of three names.

Until last week, the situation has even been murkier at the Kenya Bureau of Standards (Kebs). The then Industrialisation Henry Kosgey controversially appointed a managing director outside the official shortlist.

The farcical appointment of Joseph Koskey itself came on the backdrop of an unprecedented drama revolving around the re-appointment of a serving boss only for another minister to revoke the appointment.

Until last week’s eventual appointment of Eva Oduor as substantive managing director, the position of managing director at the standard’s agency was increasingly becoming jinxed.

At the Communications Commission of Kenya (CCK), it was a case of who wields more powers between an adamant director general and a board hell-bent to send him packing on the basis of underperformance.

While the director general, Charles Njoroge, emerged victorious, his second stint at the CCK was cut short by the High Court where another round of wrangles on the running of the regulator is playing out.

The Central Bank of Kenya (CBK), which in recent weeks has come under salty criticism due to its (mis)handling of the monetary policy, is also embroiled in controversy over the establishment of a board of directors.

The paralysis in these parastatals is nothing unique as they join a long list of state entities that have been engulfed in fireworks whenever the opportunity to appoint or re-appoint a chief executive arises.

They include New KCC, Kenya Seed Company, Kenya Ports Authority, Kenya Airports Authority, Athi Water Services Board, Moi Teaching and Referral Hospital, Sports Stadia Management Board, Tana and Athi Rivers Development Authority (Tarda), Kenya Medical Training College, Youth Enterprise Development Fund among others.

This begs the question of what exactly is the problem when it comes to the appointment of parastatal bosses?

According to a former parastatal boss who left a high flying job in the private sector to head a leading parastatal only to have his name dragged in mud when the time for re-appointment came, the problem facing State appointments boils down to a myriad of conflicting interests.

"I transformed a laggard parastatal to a profit making company but was still sacked because of interests from all corners," he said, adding that performance is insignificant if you are not in good books with powerful individuals.

Unlike companies in the private sector that operate under clear laws, parastatals are sandwiched between the State Corporations Act and the limited companies laws, something that gives room for confusion on who they are answerable to.

The State Corporations Act outlines the procedures of appointing parastatal chiefs that involve the board of directors advertising the position, conducting the interviews and short-listing the successful candidates.

The board then presents three names to the line minister who is supposed to pick one name for appointment.

The board is also mandated to evaluate performance and recommend for re-appointment.

So how does the process get bungled up?

According to analysts, the process of hiring a parastatal head often gets murky the moment the contract of a serving chief executive expires and is up for a re-appointment or replacement.

For a re-appointment, the serving boss is required to write to the board at least six months before the expiry of the contract requesting for another term upon which the board is expected to carry out an evaluation of the performance and recommend for renewal of the contract or not.

But while the process seems clear-cut, other forces like political influence (read Kebs), ethnicity (read KRA) and entitlement (read KPA) among others often come to play, something that throw the whole process into confusion.

Trivial issues like the working relationship between the minister and his assistant and permanent secretary come into play during this process.

Appointment of new heads

The stakes are even higher when it comes to appointment of a new head. As witnessed in the Kebs fiasco, ministers are usually determined to go the extra mile to ensure their ‘man’ gets the job.

"The level of impunity demonstrated by ministers is incredible because they know they will always get away," says Mati.

Ms Mugo adds that the fact that ministers have the powers to disband boards in parastatals has made the situation even worse even when boards enlist the services of professionals recruitment firms to advertise, recruit and forward names.

"Ministers can disband boards if they do not agree," she said, adding that this scenario often intimidates board members and makes them compromise due process.

In most of the controversies that engulf the appointment of parastatal heads, there is always an invisible hand, which plays a critical role of fuelling or putting out the fires of Francis Muthaura, the Head of Public Service and Secretary to the Cabinet.

Though parastatal chief executives are answerable to permanent secretaries and ministers in the line ministries, the nature of Muthaura’s office gives him authority to meddle in the affairs particularly regarding appointments and re-appointments.

During the height of the Kebs debacle, Muthaura’s was in the middle of it when he personally sacked former managing director Kioko Mang’eli due to ‘public interest’.

But the controversies that mark the appointment of parastatal heads could be a thing of the past come next year when the dynamics of power takes a complete shift.

According to the new Constitution, cabinet secretaries will no longer be politicians but professional technocrats who will be required to observe high levels of professionalism in running of ministries and agencies under them.

"We are heading to an era where the culture of doing things above board must be respected," noted Ms Mugo.