Dr Ezekiel Mutua has lost a bid to quash a demand requiring him to refund Sh27,612,360 in irregular salary hikes and entertainment allowances he received during his tenure as Kenya Film Classification Board (KFCB) boss.
The State Corporations Appeal Tribunal has ordered Dr Mutua to refund the amount.
Dr Mutua’s salary was illegally increased to Sh1.1 million in 2019 following an irregular and unlawful board decision.
The increased salary went against the Sh480,000 cap placed by the Salaries and Remuneration Commission (SRC) for the KFCB CEO position.
Dr Mutua, who served as KFCB CEO from October 26, 2015, to October 2018 (first term) and from October 2018 to October 2021 (second term), was also accused of illegally earning a monthly entertainment allowance of Sh100,000 since 2016.
As his first term neared expiry, he requested a renewal. In a letter dated May 14, 2018, the KFCB Board Chairman requested the renewal from the then-Cabinet Secretary for Sports and Heritage.
However, on May 29, 2018, the CS wrote to the board indicating that the government did not intend to renew Dr Mutua’s contract.
Contrary to the CS’s directive, the board renewed the contract on June 7, 2018 for another three years effective October 26, 2018.
Following the renewal, the board during a meeting on November 21, 2018 directed the KFCB Human Resource and Administration Committee to review and provide guidelines on Dr Mutua’s salary increment based on his past performance.
At a subsequent board meeting held on January 31, 2019, the proposed salary increment was discussed. The committee chairperson advised that further consultations were needed before implementing the increment.
Despite this, the proposal to increase Dr Mutua’s salary was adopted by the majority of board members raising his pay from Sh348,840 to Sh1,115,850. To implement the increment, the board wrote to the Cabinet Secretary again seeking approval.
However, in a letter dated April 30, 2019, the CS declined the request and advised the board not to implement the increment.
“From the facts of the matter, it appears that the board never implemented the directions of the Cabinet Secretary to stop the increment or recover the amounts that may have been paid, which then gave rise to the instant matter. The appellant (Mutua) proceeded to serve his full three-year term, during which he continued to draw the revised salary of Sh1,115,850,” read a judgment by the State Corporations Appeal Tribunal.
Dr Mutua had filed an appeal challenging a surcharge issued by the Inspector General (IG) of State Corporations who sought to recover the irregular salary increment. The IG issued a surcharge certificate after investigating the matter and concluding that the salary hike constituted a loss of public funds.
In his defense, he argued that the inspector-general erred in declaring the increment irregular, as it had been approved by the board. He also contended that the inspector-general had not demonstrated that the increase constituted an overpayment that warranted the issuance of a surcharge certificate.
“The inspector-general has not shown any loss incurred by the Kenya Film Classification Board to warrant such a surcharge,” Dr Mutua argued.
He further claimed that the Sh27 million surcharge did not account for taxes already remitted which would result in double payment and was therefore unjust.
However, the IG maintained that on December 7, 2017, the Salaries and Remuneration Commission (SRC) conducted a job evaluation at KFCB and set the CEO’s salary at Sh348,840, which Mutua earned during his first term.
“The Inspector General contends that Mutua’s second term was irregularly and unlawfully renewed without input from the SRC, SCAC, or approval from the Cabinet secretary,” the inspector-general stated.
It was further pointed out that during his first term, Mutua served under guidelines set by the State Corporations Advisory Committee (SCAC), under which the KFCB falls—an argument with which the tribunal agreed.
“From our analysis of the matter, we have already made findings that the salary increment for the appellant, as the CEO of the KFCB, was irregular and unlawful. We conclude that the IG’s decision to surcharge was justified. Based on this analysis, the appeal is hereby dismissed and the certificate of surcharge for the sum of Sh27,612,360 is upheld and confirmed against the appellant (Mutua),” ordered the tribunal chaired by Aggrey Lucas Kidiavai.
