Folks,

It is ridiculous that the Coalition Government with its operating systems and the International Corporate special business interest are working outside Public Mandate requirement of the New Constitution.

It is time we force and get rid of Kibaki and Raila from public service now. I propose Public “Vote of No Confidence” in an open public forum Referendum……online or otherwise……..Please spread the worlds and this must pick and generate like bush fire………It is Now or Never……..I am sick and tired of being sick and tired……..Let UN with World leaders including Friends and Sympathizers of Kenya’s Democratic Rights…….

The more we wait, the more they take us for granted, the more they do wicked and evil unthikables……and also you do not wait for a terminal sick madmen to help themselves or seek for remedy by themselves. We should take initiative to improve matters. The Kenya Police too cannot reform itself, we have to take it upon ourselves to help the mad-house of the wicked to see Reform.

We have identified who is who is the problem of Kenya’s cancer, let us fix it so we are able to resolve and get on a feasible workforce development in a progressive path to achieve development prospects which will engage popular participation, and which will lead to a better future available to all without discrimination or favour………

Public Resource theft is a criminal activities that should be taken seriously with the urgency it deserves before the Court of Law, to be charged as necessary. We condemn it in totality and the culprits to be brought to book to recover the same……..

Each and everyone must take charge in their own respective way to see justice is done in a short space of time.

Thank you all and God Bless……

Judy Miriga
Diaspora Spokesperson
Executive Director
Confederation Council Foundation for Africa Inc.,
USA
http://socioeconomicforum50.blogspot.com

– – – – – – – – – – –

Nairobi Star (Nairobi)

Kenya: We Must Never Tolerate Theft of Public Resources
Miguna Miguna

8 November 2011

opinion

The Prime Minister of the Republic of Kenya, Raila Amolo Odinga, admitted in Parliament last week that more than Sh308 million of public money was lost – indeed squandered – by his office and related implementing ministries between 2008 and 2010. This only related to Phase One of the KKV. He also admitted that more than Sh20 million was misappropriated by his office in the year 2011 on Phase Two of the project.

Phase One of the KKV project was wholly funded by the public to the tune of Sh7 billion whereas the second phase of Sh4.3 billion was funded by the World Bank. That’s roughly Sh10.3 billion of public money.

That money is capable of constructing, equipping and staffing more than ten thousand primary schools where millions of poor kids would have gotten an education. What that amount of money has done should be visible to all Kenyans. But we clearly cannot see any evidence of where it all disappeared to. Sh10.3 billion isn’t chicken feed. It can’t be dismissed as inconsequential, as both the PM and some MPs have done.

Any public money – even one shilling – shouldn’t be stolen by anyone without any consequences! Can anyone please show us how such colossal amounts of public money have been spent? How has it qualitatively improved the lives of millions of unemployed youth?

The PM’s admission in Parliament came grudgingly. It wasn’t voluntary. Nor was he contrite. Curiously, he seemed to take back the admission by insisting that “no single cent has been lost”. That’s after reading out a litany of millions of irregular, unauthorised and clearly dodgy payments made out by his office in breach of the government’s and the Bank’s procedures and regulations.

A few days before, the PM had proclaimed himself “as white as cotton” over the allegations. He repeated that in Parliament and completely refused to appreciate that he is the Prime Minister of Kenya, a highly privileged public official and trustee. That wasn’t statesman like. It wasn’t respectful of the public either. It was callous. Astonishingly, the PM exhibited a reckless sense of entitlement on live TV. His presentation in Parliament was contradictory, illogical and completely unbelievable.

No wonder TV polls conducted that evening showed that over 60% of viewers didn’t believe him. A true statesman would have genuinely apologised and ordered thorough investigations over the alleged fraud. He would have immediately relieved his officers named in the World Bank report: Rachel Gesami, Caroli Omondi, Mohamed Isahakia, Bernard Wandera and Patrick Chabeda. This isn’t time for scapegoats and political shenanigans!

Kenyans expect their PM to show sensitivity and understanding on matters touching on their welfare, particularly on issues of good governance, accountability, transparency and corruption. They expect and deserve to see that their PM cares about them and would protect the public interest; not his own or his cronies’ interests.

Yet, there he was – defending the indefensible. Instead of defending the public interests, the PM defended his senior staff. Is he in tune with the values enshrined in the Constitution? Is he capable of upholding and implementing the Constitution?

The PM’s admission was in response to a question by the MP for Saboti, Eugene Wamalwa, in which he sought to know how much money has been committed to the KKV project from inception; how much money has been lost through alleged corruption with respect to the KKV; who is responsible for the alleged loss of funds; and whether the PM would be prepared in the circumstances to take political responsibility for the loses.

Mr. Wamalwa’s questions were precipitated by the leakage of the World Bank’s “in-depth audit review” of the Kazi Kwa Vijana Project dated September 13th, 2011. The “audit review” only dealt with phase two of the KKV.

The PM and others have condemned that leakage. Why? How else was the public going to learn of the massive theft if the report hadn’t been leaked? Why blame the heroic whistle blower and not the thieves?

The PM has tried to pour cold water on the allegations. He has essentially said: “yes, millions of tax payers’ money disappeared in my office under my watch…but that’s not theft. Neither my officers nor I are responsible, either…” Well, who is then? Who authorised those millions to be paid out in breach of the law? Unauthorised payment is nothing but theft. Who will take responsibility for that?

The evidence of theft is compelling. This is a grave matter. We can’t treat it casually. It doesn’t and shouldn’t matter who is involved. When it comes to matters of integrity, ethics and public interests – no one is sacred.

Here are the hard facts from the World Bank report:

More than Sh33 million of our money was disbursed to senior civil servants and other ineligible third parties without following existing government and World Bank payment procedures. Millions were paid to unrelated project activities in breach of project legal agreements and Bank policies and guidelines. In many cases, money was incurred in excess of the approved limits.

There were numerous payments made without proper supporting documents in clear breach of government and World Bank financial disbursement policies and guidelines. Other payments were made for contracts that contravened the Bank and government procurement procedures.

In the case of Mrs. Gesami, she was illegally and concurrently placed on both World Bank and government payroll. The PM’s Office deliberately concealed the fact that she was a full-time public employee and misled the Bank into approving her hiring as a “consultant”. She was consequently paid more than Sh5 million on top of her regular government earnings. That was fraud.

The PM’s permanent secretary, Mohamed Isahakia, is cited – directly – five separate times. These are in addition to sixteen other serious alleged irregularities touching on him. He paid Sh1.2 million meal allowances to employees while they were at their work stations. He also irregularly paid Sh173,668 commuter allowance for employees at the PM’s office. He hired 26 unauthorised interns and paid them. More than Sh1.5 million was paid out to unknown and unauthorised persons.

Private companies like Copy Cat Ltd, Parallel Media, ISIS Solutions, DT Dobie, Kenya Shell, Total Kenya Ltd, Morven and Kester were paid more than Sh23 million for unauthorised services rendered to employees at the PM’s office. Retroactive payments were made on fraudulent invoices. Cash payments were made without supporting documents. The PM’s personal secretary, administration secretary and other unauthorised persons were either paid, their personal vehicles serviced and illegal fuel cards irregularly issued. All these amounted to tens of millions of shillings of our money.

Theft is a popular name for larceny. It is an act of stealing. It involves intentional taking of someone’s property without his or her consent. It includes illegal conversion or exerting unauthorised control over property. Embezzlement is theft. So is obtaining control over property by deception or false pretexts. Clearly, Kenyans never consented to the massive theft of the KKV project funds by senior officers at the PM’s office and at other ministries.

It shouldn’t and doesn’t matter the amounts involved. If a robber goes to a bank with a gun and forces the teller to give him Sh100 – by force, false pretext or through forgery – before attempting to flee with the money, it wouldn’t and shouldn’t matter if he is caught before he actually leaves the bank. It shouldn’t matter that the teller might have been deceived or forced to give out the money. Theft would have been established. The thief acted on an intention. End of story!

That’s what happened in the KKV scandal. (Oh yes, that’s what it is!) Those who carried out the massive theft have been caught. They acted on their intentions. They stole public funds. They can’t get away with a slap on the wrist under the pretext of “refunds” of money they stole from us. We must have full restitution, yes. But the thieves must also be severely punished. They should be prosecuted, convicted and sent away for a few years. They cannot continue to hold public office. They lost our trust. They must also be publicly shamed. The culture of impunity must not be allowed to persist.

I am calling for both criminal and political responsibility for all implicated – starting with the PM, his PS, chief of staff, administration secretary, director of policy and all the senior staff mentioned in the World Bank audit report just like I did when William Ruto, Amos Kimunya and Moses Wetangula were on the dock over alleged embezzlement of public funds. Nobody is above the law!

Miguna is an advocate of the High Court of Kenya. He is also a Barrister and Solicitor in Ontario, Canada.

Treasury losing revenue due to tax leaks
Published on 05/11/2011

By Kenneth Kwama

The Kenya Revenue Authority (KRA) could be losing up to Sh1 billion every month in unfulfilled tax obligations because current revenue collection methods cannot sufficiently track the origin of some products sneaked into the domestic market.

Most affected are alcohol and cigarette manufacturers who are required by law to affix excise stamps on their products, with conservative estimates gravitating towards Sh9 billion loss in sales annually for the alcohol and spirits industry players. The loss is mainly attributed to backdoor sale of products with fake excise stamps.

“Stemming illicit trade requires concerted effort. Alarmingly, the trade in illicit cigarettes denies the exchequer billions of shillings in lost revenue,” says British American Tobacco (BAT) Head of Communications Selena Olende.

The excise stamps, which need sophisticated technology to make, are being imported from China and this makes it difficult for the authority, which still uses manual system of identification to verify or monitor such products as they find their way into the local market.

Interestingly, there have been suggestions that KRA could substantially eliminate risks associated with current revenue collection methods by automating its systems. Automation, it’s argued would facilitate issuance of digital stamps that supports proper tax accounting, but KRA has been slow to embrace this technology.

Industry players, however, contend that from an excise tax point of view, the authority loses Sh1 billion every month by not using modern technology that has the potential to seal such loopholes.

Tax registry

“The Simba system, which is used in Customs Department, was conceptualised and implemented in a record six months. Although it has a few challenges, it is largely a good system. On the other hand, the Domestic tax system that KRA has put in place since 2006 is yet to be fully implemented.

KRA is still struggling to implement its first module, called tax registration,” says an industry source who requested not to be named because of the sensitivity of the matter.

Weekend Business was unable to get comment from the Commissioner of Domestic Taxes, Large Taxpayers Office John Njiraini by the time of going to press, despite promises he would grant the writer an interview.

The fact that Kenya is preparing for General Election next year and the need to roll out county governments will probably bludgeon next year’s budget to figures that have never been heard of.

Outdated models

Being the lead agency in putting money at the Treasury for onward relocation to projects that run the country, the tax leaks and the fact that the authority seems to be grappling with how to shake off outdated models of revenue collection system should be a major hurdle for KRA to meet this expanded budget needs.

BAT, Kenya Wine Agency Ltd (Kwal) and East African Breweries Ltd have all been adversely affected by the influx of counterfeited products.

Last week, Kwal claimed that some individuals and companies were packaging alcoholic drinks in 250ml glass bottles that are illegally embossed with the firm’s name besides using fake excise stamp to show the products are tax compliant.

“We shall not accept any liability arising from the manufacture, sale or distribution or consumption of any other alcoholic drinks that are packaged in the 250ml bottle bearing the name Kwal, embossed at the bottom,” said the firm.

On the other hand, BAT says it has had measured success in its capacity building programmes with law enforcement agencies, though it still feels there is need for more to be done.

Kwal says it will take legal action against the counterfeiters, but reckons that the problem is how to locate the bogus operators. In cases where they are located, the penalties, it says, are not usually stiff to deter future misconduct.

“I remember a case where officers at EABL and Kwal had located a person who was using fake excise stamps to sell spirits, but he was fined only Sh500,000 and was allowed to get back to work,” said the industry source.

Despite a remarkable improvement in overall tax figures, KRA has consistently performed below target when it comes to excise revenue where it has not been meeting its target, in some cases by close to Sh3 billion. Compliance among small manufacturers has been averaging 70 per cent in the last three years.

Test run

The tender to award the current domestic tax system was given in 2003 and was to run till 2006 after which it was to be re-tendered, but this has never taken place despite the apparent challenges to the current system.

Perhaps the question should be: Why is KRA not eager to increase revenue in excise tax department by simply adopting efficient monitoring tools?