The Water Services Trust Fund (WaterFund), a Kenyan State Corporation under the Ministry of Water, Sanitation and Irrigation, was established by the Water Act, 2016.
Its mandate is to provide conditional and unconditional grants to Counties and to assist in financing the development and management of water and sanitation services in marginalized and underserved areas.
The corporation has been accused of breaching fundamental laws governing the management of government resources, including the Constitution of Kenya, the Public Finance Management Act (2012), and the Public Procurement and Asset Disposal Act (2015), all of which underline fiscal responsibility, transparency, and accountability in public finance.
Under the leadership of the first respondent, WaterFund has been criticized for turning into a cash cow pendulum.
The Auditor General’s report for FY 2021/2022 has exposed serious issues within the organization.
The WaterFund is accused of deliberately disbursing an additional Ksh 37,182,159 to Noltuesh Water under the CLSG programme, with Ksh 5,467,479 remaining unaccounted for.
Another audit query for FY 2021/2022 indicates that the WaterFund disbursed Ksh 24,650,000 to Amatsi Water Services Company Limited, despite investigations still pending over the Ksh 26,659,238 advanced to them in FY 2020/2021.
As of July 30, 2022, the outstanding receivable balance for Amatsi Water was Ksh 51,309,238 million, further complicating the relationship between the two institutions.
The audit also notes the absence of a clear cost allocation policy for overhead costs incurred. It highlights instances where WaterFund charged fuel and rent costs to donors in violation of the Public Finance Management Act (2012) and the Public Procurement and Asset Disposal Act (2015), both of which stress the importance of fiscal responsibility and transparency.
WaterFund has also been criticized for allocating bills to EU-related projects without providing a consistent and transparent basis for such allocations.
The fund is under scrutiny over Ksh 53,889,585 million arising from project expenditures incurred by implementing partners.
The appointment of the CEO, who is the second respondent, has raised concerns due to the involvement of canvassing, a practice that should result in automatic disqualification, as stated in the Public Appointments (Parliamentary Approval) Act and other relevant legislation.
The Public Appointments (Parliamentary Approval) Act (No. 33 of 2011) and other relevant laws, such as the Public Benefit Organizations Act (No. 18 of 2013), outline the procedures for public appointments, indicating the importance of merit and fair competition.
