Sh3.2bn Ruaraka land scandal returns to torment top officials

The Sh3.2 billion Ruaraka land scandal has come back to haunt individuals adversely mentioned in the suspicious deal after a three-judge bench sitting in Nairobi ruled that the land belongs to the government.

On Friday, Justices Elijah Obaga, Bernard Eboso and Kossy Bor ruled that the 17.7 acre land on which two public schools, Ruaraka High and Drive-Inn Primary, and a chiefs camp stand, is indeed public land.

The judges further indicted the National Lands Commission (NLC), then chaired by Prof Muhammad Swazuri, for misleading the Ministry of Education that saw Sh1.5 billion irregularly released as down payment to businessman Francis Mburu, who claimed to be the owner.

BALANCE

The balance was to be cleared mid last year through a supplementary budget but the Budget and Appropriations Committee of the National Assembly slammed breaks on the matter after smelling a rat.

The powerful committee is chaired by Kikuyu MP Kimani Ichung’wa. “It is therefore our finding that the two schools sit on public land. It is our further finding that the land on which the schools sit could not be subject to compulsory acquisition,” the judges ruled.

The ruling comes after the House Committee on Public Accounts (PAC) reopened investigations into the suspect compulsory acquisition of the land following findings by Auditor General Edward Ouko that the payments were irregular.

BROUGHT TO BOOK

This was after Mr Ouko’s report for the 2017/2018 financial year was tabled in the House and committed to PAC for consideration with its chairman, Ugunja MP Opiyo Wandayi, warning that no one would be spared.

“The court has now given us the basis and the impetus to ensure that those who either played a role in the payment or benefited are brought to book. PAC is going to exercise its constitutional mandate and examine the matter with the usual due diligence and bring it to a logical conclusion,” Mr Wandayi said.

“The verdict by PAC will supersede all previous recommendations by any other committee of the two Houses of Parliament.

“The public must rest assured that PAC will spare no efforts to get to the bottom of the matter,” he said in reference to previous probes by the Senate and National Assembly’s Lands committee.

The audit report notes that the land was valued by the National Lands Commission (NLC) at Sh3,262,136,690, including a 15 percent disturbance allowance.

DISTURBANCE ALLOWANCE

But the AG questioned the disturbance allowance given that the claimant had not developed the land at the time of its compulsory acquisition by the government. However, the urgency, timing and precision with which the Sh1.5 billion was sourced and paid when the country was facing a shortfall in revenue collection raised eyebrows.

Insiders within PAC said that the committee will quiz at least four Cabinet secretaries over the suspicious payments; Henry Rotich (Treasury), Dr Fred Matiang’i (Interior but previously Education CS), Farida Karoney (Lands) and Prof George Magoha (Education). Prof Magoha, who was only appointed to the post in April, will appear before the committee in the spirit of collective responsibility.

Others set to be interrogated over the scandal are Education PS Belio Kipsang, Attorney General Kihara Kariuki, Prof Swazuri and Mr Mburu, who is the key suspect in the matter.

Mr Ouko has established that NLC did not conduct due diligence to ascertain the status of the land before the payment was made to city businessman Mburu in January last year through his company, Whispering Palms Limited.

“In the circumstances, I am unable to confirm whether the process of acquisition was procedural and the payment made to the vendor is a proper charge to the public funds,” reads the report.

COMPULSORY

Although the Ethics and Anti- Corruption Commission (EACC) has concluded investigations into the matter and the file forwarded to Director of Public Prosecutions (DPP) Noordin Haji, no individual has been charged in court yet. The court ruling, however, is likely to expedite the arraignment of those adversely mentioned.

On Thursday, when he appeared before the Justice and Legal Affairs Committee of the National Assembly, EACC chief executive Twalib Mbarak said the investigations into irregular payments were still going on.

“It is the financial transactions cutting across the border that we are investigating. We have since stopped further payments,” Mr Mbarak said. The PAC probe will not be the first of its kind on the scandal.

Last year’s investigations by the Lands committee of the National Assembly and the Senate’s County Public Accounts and Investments Committee established that the land was public and that the government should not have bought what it already owned.

HOUSE COMMITTEES

The House committees also recommended that the government stops further payments as measures are put in place to recover the amount already paid. According to the auditor general, a search obtained on July 16, 2018, revealed that the property had two mortgages that were never settled.

That in the 1980s, Mr Mburu took Sh21 million from Continental Credit Finance Limited and Sh165 million from Kenya Posts and Telecommunications Corporation to develop the land.

However, the debts were neither disclosed nor cleared as required prior to the acquisition of the land by the government despite the NLC giving the deal a clean bill of health.

Mr Ouko further noted a variance of Sh6,903,910 in the valuation of the land, which has not been explained.

The Sh1.5 billion was wired to Mr Mburu’s company on January 22, 2018 as down payment with the balance expected to be cleared through a supplementary budget later in the year.

Mr Ouko said that Mr Mburu wrote to NLC on August 17, 2016 seeking compensation.

On September 13, 2016, NLC notified the Education CS at the time, Dr Matiang’i, of Mr Mburu’s request.

Dr Matiang’i would later notify Dr Kipsang, who was his PS at the time.

Dr Kipsang constituted a task force to advise the ministry on claims made by Mr Mburu.

PRIVATE LAND

In its report to the ministry, the quality assurance and standards assessment team established as public land the space the two schools and a chief’s camp occupied and should therefore not be paid for.

However, the ministry ignored the recommendations. Mr Ouko notes that on February 7, 2017, Mr Kipsang responded to NLC saying that the land occupied by the two schools was indeed private.

The letter of March 17, 2017 from the Education ministry formally requested NLC to commence the process leading to the compulsory acquisition of the land. Mr Ouko says that on January 22, 2018, the ministry transferred Sh1.5 billion to NLC for the acquisition.

The amount was paid to Mr Mburu, the vendor, on January 29, 2018 through cheque number 000936.