Sh12bn dam money at centre of Murang’a County-water firms stalemate
Murang’a Water and Sanitation Company (Muwasco) staff protest against alleged interference of the company’s operations by former Murang’a Governor Mwangi wa Iria at Kabiruini showground in Nyeri County during the water companies games closing ceremony in August 2018.
Four of the five Murang'a County Water and Sanitation Companies risk deregistration if they will not have surrendered their full ownership to the county government as ordered by June 30.
At stake is more than Sh12 billion in revenue and dam projects planned for the region.
The companies are Murang’a Water (Muwasco), Murang’a South (Muswasco), Murang’a West (Mwewasco) and Gatamathi.
Gatanga Water (Gawasco) has already surrendered fully to the county ahead of the deadline that had been issued by both the county government and the Water Service Regulatory Board (Wasreb).
Gawasco's Managing Director John Kairu said: “We are for the law and effective services since they go hand in hand."
Wasreb had on May 3 written to the four companies, reminding them "to comply with the provision of section 77(3) of the Water Act, 2016, by converting your utilities from their current status of limited by guarantee to limited by shares and fully owned by the county government ... by 30th June 2023".
The board added that the companies were required to provide a roadmap towards meeting the directive, and that failure to adhere to it would be deemed as serious non-compliance, and regulatory sanctions might apply that include withdrawal of operational licences.
County Water Environment and Sanitation Chief Executive Mary Magochi said the county was watching closely the companies’ behaviour but would consult further.
The companies are supposed to provide timelines of sittings by the boards of management to approve the takeover directive and the date of holding annual general meetings for sanctioning.
The resolutions will then be taken to public participation for adoption.
Nation.Africa learnt that the water companies’ boards of management are the stumbling block as they scheme to retain the semi-autonomous status owing to vast interests attached to the firms.
Ms Magochi said several proposals were being pursued to stem a crisis, “including deregistering the companies as they are, form new ones that will be without boards of management hence county effortlessly taking them over”.
County governments powers
Ms Magochi said the Water Act, 2016, Section 77(1) gives the county governments powers to establish water service providers (WSP) that are public limited liability companies established under Company Act 2015 and should be guaranteed by shares.
Notably, Muwasco has had former Equity Bank chairman Peter Munga as board chair since inception 14 years ago.
An attempt by former Murang'a Governor Mwangi wa Iria to take over the companies ended up in duels in court and political engagements between him and Muwasco that would occasionally turn violent.
Mr Wa Iria had, through Gazette Notice No 8391 of August 15, 2021, appointed environmentalist Joseph Kimura as Mr Munga's replacement.
The four companies are seemingly cooperating, announcing that they are ready for the conversion, but some are sponsoring an underground resistance to the directive.
"We have noted activities on the ground where there are campaigns being progressed to influence the public participation verdict on the directive. There are politicians and businessmen who are in opposing camps and they have taken to the public platform to endorse or block the county takeover of the companies," said a senior county security committee member.
Water Cabinet Secretary Alice Wahome, who is from the county, has directed that the governor takes charge of the water conflicts in the county and resolve them as soon as possible.
"I have held meetings with stakeholders and since water is a devolved function, I have directed the governor to do all possible to heal the divisive water politics in the county," she said.
It is in that tedious process that also includes the option of interested parties asking for more time as they appeal part of the processes involved that makes governor Irungu Kang'ata's directive a walk through a minefield.
Dr Kang'ata said county control in the companies stands at 54 per cent but it should be 100 percent.
The governor insisted that the directive seeks to conform with the law “nothing to do with any other interest on our side ... It's merely adhering to the law ... Whether services will improve or not once they comply is neither here nor there”.
Others see the resistance to the companies’ total control as politics and a fight for control of billions of shillings — more specifically the planned Sh12 billion dams — that has been simmering for the past 10 years.
Maragua dam worth Sh800 million
The water power games came back immediately the Kenya Kwanza Alliance government came to power. President William Ruto visited the county on October 23 and said the dams would be financed.
He announced that Maragua dam worth Sh800 million was already complete and others worth Sh11.2 billion would be built — the Sh10 billion Maragua 4 dam and the Sh1.2 billion Kigumo dam — to supply water locally and to Nairobi.
The completed dam will provide 15,000 cubic metres of water daily to residents of Maragua constituency.
From the dams comes general distribution infrastructural works worth hundreds of millions and vested interests angling for tenders.
An estimated Sh1.5 billion is expected in annual water income that includes sale of meters and licences.
The companies also secure commercial loans and partner with development partners to control huge budgets in conjunction with the Water Trust Fund.
Then there is the politics. For instance, Mr Munga, who supported Azimio in the August 9 General Election, is still the Muwasco board chairman, a position UDA luminaries believe should go to them.
Mr Munga said: “We are for everything that makes water and sanitation services better and we will embrace all progressive proposals.”
"We have UDA politics in it, Azimio influence, wheeler dealers, national government taming of independent boards and infighting among cartels using the Kang'ata directive as an attack launching base," said Water Users Action Group chair Mwaura Murira.
“Ahead of the elections, the dams had been an item of bargain where both Azimio and Kenya Kwanza loyalists had divided among themselves the opportunities and it is now time for the government to consolidate control for the benefit of its loyalists,” he added.
Government loyalists are also fighting supremacy wars ahead of 2027, he said.
“The big fish in the control game would feel more comfortable dealing with county governments rather technocrats in the water companies whose election to boards is beyond their control,” said Mr Murira.
Roadmap is clear
Muswasco Managing Director Mary Nyagah said: “There is no single company in our meetings that has expressed intention to defy (the directive), and the roadmap is clear ... It only needs ratifications in all the phases.”
Murang'a Senator Joe Nyutu warned that the matter is being discussed outside desired context and “we should not be reduced to discussing personalities and positions”.
He said the personalities in the debate will at one time vacate office, politics will change, but water and sanitation needs will remain.
“What we should be interested in is who or what will give our people clean and affordable drinking water as well as create irrigation water infrastructure,” he said.
Kimorori Wempa MCA Elizabeth Mwangi said the coming together of water companies, elected leaders, Wasreb and the people of Murang'a was the only way to heal the crisis.
“We are having multifaceted debates about what are the real intentions, goals ... but we are forgetting that what is of interest is the constitutional right of the people to access clean and affordable water. The county assembly is more grassroots-oriented than any other quarter in this conflict and we will have the will of the people prevail in this," she said.
Ms Mwangi said that even after the county government takes charge, oversight will still remain with county assembly and Wasreb.
Former Ichagaki chief Mohammed Ali Mzee asked: “What guarantee do we have that county government that delays paying workers, has been unable to prevent markets from getting waterlogged, cannot collect garbage and has run down the health sector will give us water?”
He said the surrender of water and sanitation services to the county should be subjected to thorough public participation and if need be, adjudicated through a “local referendum”.
