Auditor General questions Ketraco’s Sh431 million land compensation payments
Gathungu noted that the company failed to provide clear records of payment recipients, casting doubt on the legitimacy of the disbursements.
Auditor General Nancy Gathungu has raised concerns over the Kenya Electricity Transmission Company's (Ketraco) expenditure of Sh431 million on land compensation, citing discrepancies in financial records and insufficient beneficiary documentation.
Gathungu noted that the company failed to provide clear records of payment recipients, casting doubt on the legitimacy of the disbursements.
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In her latest report, covering the financial year ending 30 June 2024, the Auditor General revealed that Ketraco paid Sh207.5 million to 172 individuals affected by the Olkaria-Lessos-Kisumu transmission line. However, previous financial statements showed only Sh27.3 million as outstanding compensation—a discrepancy of Sh180.2 million that remains unexplained.
“Compensation was paid to 172 project-affected persons during the year under review. The previous year’s audited financial statements reflected outstanding wayleaves totalling Sh27,347,743, resulting in an unexplained variance of Sh180,165,915 paid as wayleave compensation,” Gathungu stated.
The Olkaria-Lessos-Kisumu project, launched in 2016, was completed in March 2022. Ketraco attributed the Sh27.3 million figure to the budget allocation at the time, but the audit cautioned that “failure to record all pending payables distorts accounting records.”
Further irregularities in another project
Similar issues were flagged in a separate project involving 220kV and 132kV transmission lines and substations. Ketraco reportedly spent Sh117.68 million on compensation, despite previously declaring only Sh73.5 million as outstanding.
“A review of records revealed that the compensation relates to payables for the 2022/2023 financial year and earlier years. However, the previous year’s audited financial statements reflected outstanding wayleaves totalling Sh73,501,859,” the audit noted.
Ketraco’s management explained that while Sh324.6 million in wayleaves was outstanding as of June 30, 2023, only Sh73.5 million was disclosed based on the allocated budget.
The audit concluded that Ketraco had failed to account for Sh431.27 million in wayleave payments by mid-2023, with the full sum only appearing in the latest financial review.
Ketraco, which oversees billions of shillings’ worth of transmission projects nationwide, plans to undertake future developments under a public-private partnership (PPP) model.
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