Senators want KQ's perennial losses probed despite state bailout

Senators want Kenya Airways investigated for perennially making huge losses despite frequent bailouts by the government.

The lawmakers claimed the Airline’s losses are deliberate to siphon public money through bailouts by the State.

“It is not by mismanagement, it is by design that Kenya Airways has continued to make losses because whenever it makes losses, the money is paid by the taxpayers,” Kirinyaga Senator Wahome Wamatinga said.

“It is a way to siphon money from Kenyans.” 

As of December last year, KQ’s loss stood at a record Sh38.26 billion.

Nandi Senator Samson Cherargei who triggered the debate in the debating chamber with a statement on the current operational and financial status of Kenya Airways, asked for a thorough probe.

“The airline should provide reasons contributing to the increasing operations costs of the airline,” he said.

The lawmaker in his statement committed to the Senate Trade Committee wants the team to outline strategies the Kenya Airways management has implemented to ensure timely repayment of loans without incurring additional interest and penalties.

“They should state the number of employees giving their skills and jobs assigned, addressing concerns that the management has favoured the recruitment of foreign workers for positions that could be filled by Kenya professionals,” Cherargei said.

In addition, the committee should also state the extent to which, Kenya Airways’ revenue was affected by the stalling of a Singapore Airlines cargo plane on the JKIA runways, spelling out measures that have been taken to prevent such occurrences from affecting the operations.

Senator Wamatinga said it was shocking that a Cabinet Secretary, Principal Secretaries and Managing Directors paid with taxpayers’ money would sit on the company’s board and collude with investors to defraud Kenyans.

“The equipment owned by Kenya Airways, hired by Kenya Airways, belong to the who is who in this country and it is a way of siphoning money,” Wamatinga claimed.

“It is high time we bite the bullet and say enough is enough. We are tired of Kenyans being exploited by these state corporations to siphon money from state coffers. This must an end.”

Busia Senator Okiya Omtatah claimed that public money was spent on Kenya Airways to privatise it and the government has continued pumping money into it without holding any person accountable for the losses.

Invoking the provisions of article 226 (5), Senator Omtatah charged that those responsible for the losses should be pursued and auctioned.

“Public money has been spent. In 2016, they sold what would amount to be the territory of Kenya – the special landing slot at Herthrow Airport to Oman Airways at about Sh7billion.” “Who authorized it? Did he have the mandate of Kenyans to authorize the sale? That asset belonged to Kenya and not Kenya Airways,” Omtatah said.

Mandera Senator Ali Roba said it is default for KQ to always post losses because the management knows the government is ready to bail it out.

“It is a default position of Kenya Airways that they must report a loss. When they are reporting a financial report, they must report a loss because we want to safeguard Kenya carrier and as long as they keep reporting a loss, it is bad to bail them out,” he said

Roba said Kenya Airways records more than 96 per cent seat occupancy at any given time, adding that the tickets are not any cheaper.

“The ticket pricing is higher than Ethiopian Airlines and other Airlines in the region. The cost of overhauling one engine was higher than purchasing a brand-new engine for Kenya Airways,” Roba said.

Kisii Senator Richard Onyonka told the House that Kenya Airways is owned by top companies in the country.

“Kenya Airways is owned by private individuals who have been stealing money for the last 24 years,” Onyonka said.