Parliamentary Report On KBC

7/31/2019 Parliamentary Report On KBC

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REPUBLIC OF KENYA

KENYA NATIONAL ASSEMBLY

TENTH PARLIAMENT FOURTH SESSION - 2012

REPORT OF THE

JOINT COMMITTEE ON ENERGY, COMMUNICATIONS AND INFORMATION AND

HOUSE BROADCASTING COMMITTEE

ON THE

PUBLIC PETITION ON THE STATE OF AFFAIRS AT THE KENYA BROADCASTING

CORPORATION

-------------------------------------------------------------------------------------------

CLERKS CHAMBERS,

PARLIAMENT BUILDINGS,

NAIROBI MAY, 2012

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Table of ContentsLIST OF ACRONYMS AND ABBREVIATIONS ................................................................................................. iiiPREFACE....................................................................................................................................................................vSUMMARY OBSERVATIONS, FINDINGS AND CONCLUSIONS ................................................................. viiSUMMARY RECOMMENDATIONS .....................................................................................................................xiACKNOWLEDGEMENTS..................................................................................................................................... xii

CHAPTER ONE: INTRODUCTION AND BACKGROUND ................................................................................11.0 INTRODUCTION .................................................................................................................................. 1CHAPTER TWO: SUBMISSIONS BY STAKEHOLDERS...................................................................................3

2.0 INTRODUCTION .................................................................................................................................. 32.1 MEETING WITH THE PETITIONERS (KBC STAFF) ................................................................................. 32.2 MEETING WITH THE KBC BOARD OF DIRECTORS AND MANAGEMENT..................................... 152.3 EVIDENCE BY MINISTER FOR INFORMATION AND COMMUNICATIONS.................................... 232.4 EVIDENCE BY FORMER MANAGING DIRECTORS OF KBC........................................................... 262.5 EVIDENCE BY THE MINISTER FOR FINANCE.................................................................................... 322.6 MEETING WITH ENGINEER GICHINA KANYI................................................................................... 342.7 MEETING WITH THE PERSON ACCUSED OF SEXUAL HARASSMENT............................................ 352.8 MEETING WITH MR. PATRICK QUARCOO...................................................................................... 362.9 ADDITIONAL EVIDENCE BY THE MANAG EMENT OF KBC ............................................................ 372.10 EVIDENCE FROM THE WITNESS OF SEXUAL HARASSMENT........................................................... 382.11 MEETING WITH ENG. PHILLIP OKUNDI............................................................................................ 392.12 MEETING WITH THE CHIEF OF THE RADIATION PROTECTION BOARD ........................................ 402.13 WRAP UP MEETING WITH THE MINISTER FOR INFORMATION AND COMMUNICATIONS........ 412.14 FINAL SUBMISSION BY THE PETITIONERS......................................................................................... 422.15 VISIT TO KBC OFFICES IN KISUMU ................................................................................................... 44

2.16 VISIT TO KBC OFFICES IN NAIROBI.................................................................................................. 462.17 VISIT TO KBC OFFICES IN NYERI....................................................................................................... 472.18 VISIT TO KBC OFFICES IN MOMBASA ............................................................................................. 48CHAPTER THREE: COMMITTEES FINDINGS, OBSERVATIONS AND CONCLUSIONS......................51CHAPTER FOUR: RECOMMENDATIONS ........................................................................................................60

ANNEXES


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LIST OF ACRONYMS AND ABBREVIATIONS

AMTS Assista nt Ma na ger Tec hnica l Servic es

BBC British Broadc asting Co rpora tion

BSI Broadc ast Solutions Internationa l Ltd

CEO Chief Exec utive Office r

CCK Co mm unica tion Comm ission of Kenya

COR Code of Reg ula tions

CO TU Ce ntral Organiza tion of Trade Unions

CTO Chief Tec hnica l Office r

EABC East Afric an Broa dc asting Co rporat ion

EACC Ethics and Anti-c orrup tion Co mmission

EMU Effic ienc y Mo nito ring Unit

FKE Federa tion of Kenya Employe rs

FM Freq uenc y Mode

HR Human Resource

HRM Human Resourc e Ma nager

ICT Informa tion, Co mm unica tion Tec hno log ies

KACC Kenya Ant i-Co rrup tion Co mmission

KBC Kenya Broa dc asting Corporat ion

KBS Kenya Broadc asting Services

KIMC Kenya Institute of Ma ss Comm unica tion

KNA Kenya Nationa l Assem b ly

KRA Kenya Revenue Authority

KU Kenya tta University

LPO Loc a l Purcha se Orders

MBA Maste rs of Business Ad ministra tion

MD Ma nag ing Direc tor

MoU Memo randum of Understand ing

MW Med ium Wave


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PAYE Pay As You Earn

PBU Parliamentary Broa dc asting Unit

PCA Pay Change Advic e

PCK Posta l Co rpora tion of Kenya

PNU Party of Nationa l Unity

PPS Presidentia l Press Servic e

TARDA Tana and Athi River Deve lop me nt Co rporation

UoN University of Na irob i

VoK Voice of Kenya


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PREFACE

Mr. Speaker Sir,

It is my honour and p lea sure to p resent to this Aug ust House, the rep ort of the Joint

Committee on Energy, Information and Communications; and the House

Broadcasting Committee on the petition by the Kenya Broadcasting Corporation

(KBC) employees.

Mr. Speaker Sir,

On Thursday 1st of March 2012, the Hon. John Mbadi M.P tabled a petition signed

by 248 employees of the Kenya Broadcasting Corporation proposing various

reforms a t the Corporation.

The pet itioners c ited tha t:-

1. Wherea s Artic le 34(4) of the Co nstitution p rov ides tha t a ll Sta te-owned me diashould be free to determine independently the editorial content of their

broadcast or other communications, be impartial and afford fair opportunity for

presentation of divergent views and dissenting opinion, the Kenya Broadcasting

Corporation w hic h wa s estab lished by the Kenya Broa dc asting C orpora tion Ac t,

Ca p .131 op erates in a n environm ent of interferenc e, politic a l manipulations and

low em ployee s terms of servic e a nd op pressive wages.

2. Tha t the m anagem ent of KBC ha s over the yea rs fa iled to a dd ress thegrievances of their staff and instead resorted to victimization whenever a

memb er of sta ff ra ises a c onc ern.

3. Tha t the KBC ha s bee n misma na ged lea d ing to b ra in d ra in, loss of revenue, andletha rgy amo ngst mem bers of sta ff.

Mr. Speake r Sir,

The p etitioners p rayer wa s tha t the Parliame nt of the Rep ub lic of Kenya:-

i) Do investiga te the Corporation with a view to estab lishing the fa c tors tha t ha veled to the c urrent sta te o f affa irs a t the KBC;

ii) Do investigate the concerns related to the welfare of staff of the Corporationwith a view to addressing their grievanc es and offe ring a long-term solution;


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iii) Do review the Kenya Broa dc asting Corporation Ac t, Cap .131, with a view toharmonizing the law with the Constitution and strengthening the

c om petitiveness of KBC;

Follow ing the tab ling of the p et ition and in line w ith the Sta nd ing Orde r No. 210 (1),

the Spea ker d irec ted the Joint Committee on Energy, Communications andTec hnology; and the House Broa dc asting C ommittee c ha ired by the Hon. James

Reg e, MP and the Hon. Nic olas Gumbo, MP respec tively to investiga te the ma tter

and tab le the rep ort in the House w ithin 21 da ys.

Ensuing from this ruling, the joint Committee held a meeting on 3rd March, 2012 to

deliberate on its p rog ramm e of a c tivities.Committee c omposition

The Joint Co mm ittee c om prises the fo llow ing Me mb ers:

1. The Hon. (Eng .) James Rege, M.P. - Co-Chairman2. The Hon. (Eng .) Nicolas Gumbo, M.P - Co-Chairman3. The Hon. Clement Wamb ugu. M.P4. The Hon. Ma ina Kama u, M.P5. The Hon. Emillio Ka thuri, M.P6. The Hon. Joshua Kutuny, M.P7. The Hon. Cha rles Kete r, M.P8. The Hon. Da vid Koe c h, M.P9. The Hon. Cyp rian O mollo, M.P10.The Hon. Aden Duale, M.P11.The Hon. Prof. Philip Ka loki, M.P12.The Hon. Ad en Keyna n M.P13.The Hon. Ekwee Ethuro, M.P14.The Hon. Edwin O. Yinda , M.P15.The Hon. Pete r Kiilu, M.P16.The Hon. Ged ion Mb uvi, M.P17.The Hon. Benjam in Jomo Washiali, M.P18.The Hon. Eva ns Akula, M .P19.The Hon. William Kabogo, M.P


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Com mittee sittings

The joint Com mittee held a tota l of 31 sittings and rec eived oral and written

sub missions from the following sta keho lders:-

i) The Minister for Informa tion a nd Co mm unica tions;ii) The Ministe r for Financ e;iii) The Permanent Sec reta ry, Informa tion and Comm unic a tion;iv)The Boa rd of Direc tors and Ma na gem ent o f KBC;v) The petitioners (KBC sta ff);vi)Former Ma na ging Direc tors of KBC;vii)Vic tims of sexua l ha rassme nt, a witness and the ac c used ;viii)Eng . Phillip Okund i;ix) Mr. Patric k Qua rc oo , the CEO o f Rad io Africa Ltd .; and

x) Eng. Gichina KanyiThe joint Committee a lso visited KBC offices and sta tions in Kisumu, Nyeri, Nairob i

and Momba sa.

Due to the expansive mandate and the large number of witnesses, the

Committee could not conclude the inquiry by the deadline and was granted a

further extension of tw o w ee ks by the Spea ker on 18th April 2012 to enable it

fina lise its work and tab le the rep ort in the House.

SUMMARY OBSERVATIONS, FINDINGS AND CONCLUSIONS

Administrative issues

i) The Com mittee no tes tha t the rec ruitment and p rom otion proc ed ures of sta ffa t KBC a re q uestionab le.

ii) The C om mittee ob serves tha t the qua lific a tions of the Huma n Resourc eManager (HRM) as advertised in the news papers on 8 th April 2010 required

the candidate to posses an undergraduate degree, a post graduatediploma in human resource management and a Masters in Business

Ad ministra tion. The Co mm ittee further ob serves tha t the qua lific a tions of the

Managing Director (MD) required lower qualifications than the HRM of only

an und ergraduate deg ree in soc ia l Sc ienc es desp ite the M Ds position b eing

a superior position. The Com mittee therefo re no tes the a noma ly and further


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that the advertisement for the position of MD seemed to be in favour a

specific candidate.

iii) The Com mittee notes tha t desp ite the c ritica l role p layed by KBC a s theNationa l b roa dc aster, the Co rporations employees are p oo rly remunerated .

The app ointment of unqua lified Rad io Program mes Manager

i) The Co mm ittee notes tha t the appointment o f Mr. Wa lter Mong are a s theRadio Programmes Manager of KBC was irregular. Whereas the job

description of the radio programmes manager required the candidate to

possess a deg ree in c om munica tions, the d oc uments submitted ind ic a te tha t

Mr. Mongare holds a Diploma in Graphics (desk top publishing) from Kul

Grap hics and is yet to c om plete his deg ree a t Kenya tta University (KU) which

he has bee n pursuing since 1996.

ii) The Committee no tes tha t the hiring of a n unqua lified ma nager has c ausedd isc ontent a mo ng KBC sta ff and was one o f the rea sons for the strike.

The plight of Artistes and casual staff of KBC

i) The Comm ittee notes tha t d esp ite p laying an important role a t KBC, theartistes and casual staff have been neglected and are treated as second

class employees notwithstanding the fact that a majority of them havesuperior ac adem ic qua lific a tions than permanent e mp loyees of KBC .

Financ ial issues

i) The Co mm ittee notes tha t KBC is insolvent a fac t which the Minister forInformation and Communications and the Minister for Finance concurred

with and tha t there is need for massive injec tion of fund ing to KBC to prote c t

it from imm inent collapse.

ii) The Comm ittee notes tha t reve nue c ollec ted a t KBC is not p rop erlydocumented.

iii) The Comm ittee no tes tha t KBC ha s suffered from lac k of financ ia l supportfrom the Government considering the government usually requests for live

c ove rage o f its functions yet it d id not p ay for the same .


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The Japanese Loa n

i) The Committee ob serves that the ba lanc e o f the Japane se loan ob tainedfor the Rad io MW mo derniza tion p rojec t in 1989 stood a t KSh. 22 b illion and

has adversely affec ted the Corpo ra tions financ ia l sta tus. The Com mitteefurther observes that due to the inability of KBC to meet its loan repayment

ob liga tions, Trea sury wa s re-paying the loa n on its beha lf but expec ted

reimbursement from KBC with interest at market rates.

ii) The Comm ittee no tes tha t the ma in c ause o f KBC s fina nc ial prob lem s is re-payment of this loan. According to the 2009 KBC accounts, the total gross

income of KBC was Kshs. 1,405,644,645.06 against the expenditure of Kshs.

3,535,016,696.71 which comprised of financial charges of Kshs.

1,943,326,391.32 as the money pa id to Trea sury by KBC on ac c ount o f theJapanese loan. As a result, KBC made a loss of Kshs. 2,129,372,051.65. This

c onfirms tha t KBC is solvent save for the Japanese loa n.

iii) The Com mittee is agreea b le to the p rop osa l tha t the g ove rnment shouldencourage its agencies to place a certain percentage of their

advertisements with KBC in a similar way it has compelled other government

agenc ies to use p ub lic fac ilities like c onferenc e c enters.

Protection of the workforce

i) The Com mittee no tes tha t to a c ertain extent, there ha s been politica linterferenc e in the ma nag ement of the Corporation. This c an b e d ed uced

from the exit o f seve ra l MDs under unclea r c irc umstanc es and from the c ited

c ases of influenc e o n the b roa dc ast c ontent.

ii) The Com mittee no tes tha t the KBC Ac t Ca p 221 is outd a ted and should b ereviewed to make it consistent with Article 34 (4) of the Constitution and to

confer independence to the managers of the institution to shield them

aga inst politic a l interference.

Allega tions on Flawed Proc urement and Corruption

i) Evide nce subm itted be fore the Com mittee by the ma nag eme nt of KBCconfirms that York investments Ltd., Grand photolab E.A Ltd. and Leon

Insurance company pre-qualifed by KBC are indeed owned by the same

individual. From the documents supplied by the Management of KBC, the


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Comm ittee notes tha t the Grand Photo lab and York Investments appea rs to

have been involved in seve ra l tende rs.

ii) When the KBC ma nag ement ap pe ared b efore the Committee they disputedthe above allegations and asserted that even though considerable businesshas be en g iven to the three c omp anies, a t no point had the c omp anies ever

bid a ga inst ea c h other on the sam e tend er.

iii) The C om mittee finds nothing unusua l if c ompanies ow ned by the samepe rson have no t co mp eted on the sam e tend er.

iv)The Comm ittee has estab lished tha t a tea m from the Pub lic Proc urem entand Oversight Authority is investigating claims of alleged malpractice in

partic ula r to estab lish if the p roc urement law has been follow ed .( annex 12)

Conflict of Interest on part of Board Members

i) The Committee no tes tha t Broadc ast Solutions Inte rna tiona l (BSI) traded w ithKBC in the year 2010 and 2011 and is a pre-qualified supplier for 2011-13

desp ite its d irec tor Mr. Stephen Areb a being a Direc tor of KBC. The

Committee finds that the Chairman of the KBC Board and the MD

deliberately misled the Committee with respect to the business relationship

betwe en KBC a nd BSI and tha t either the Cha irma n wa s being e vasive in his

evidenc e or he wa s truly not aw are o f the de a lings a t the c orporation.

Misap prop riation o f funds from the Parliam entary Broad casting Services

i) The Co mm ittee is d issa tisfied with the response by the KBC m ana gem ent toc ounter alleg a tions tha t a c om mission of Kshs. 200,000/ - is pa id to one of the

senior ma nagers a t KBC. The Co mm ittee further notes tha t the re is apparent

discrepancy in these commission payments considering the Parliamentary

Broadc asting Unit (PBU) sta ff disputed ever rec eiving a ny Co mmissions from

the po oled m oney despite p laying a c ruc ia l role in the process .

Status of KBC land

i) The C om mittee notes tha t KBC ha s 36 parcels of land sc a tte red in d ifferentparts of the c ountry with an estima ted ma rket va lue of Ksh. 2.8 b illion. The


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Committee however notes that the management does not possess the title

deeds to a ll these p arc els of land .

ii) The Co mmittee further notes with conc ern that land ha d be en g rabb ed a tthe Mo mb asa site a nd wa s the subjec t of a c ourt c ase.

SUMMARY RECOMMENDATIONS

1. Tha t KBC should be restruc tured and refo rme d to a Nat iona l Pub licBroa dc aster fully fund ed by the Exche quer. The new struc ture of KBC should

include among others, a commercial department, a technical department

and a n infrastruc ture d ep artment.

2. Considering the present state of affairs at KBC most of which have beencaused by poor management and administration, the Board of Directors andthe Ma nagem ent of KBC should take responsibility.

3. The joint Co mm ittee is c onc erned by the fa ilure o f the Minister for Informa tionto implement an earlier recommendation made by the Departmental

Com mittee on Energy, Informa tion a nd Com munic ations and ad op ted by the

House tha t the KBC Boa rd be re-constituted . The joint Comm ittee rec om mends

that the Minister for Information and Communications disbands and

rec onstitutes the Board of KBC, w ithin thirty d ays.

4. All the senior ma nage rs and hea ds of dep artme nt of KBC should b e ve tted bythe newly constituted board to ascertain their suitability for the managerial

positions.

5. The ma nagement should imp lement a c omprehensive p olic y on rec ruitmentand a scheme of service to guide employment, promotions, transfers and

grad ing of sta ff.

6. KBC Boa rd should h ire a Human Resourc e firm to ha rmo nize and ra tiona lize thestaff and management structure at KBC. Following this harmonization, the

artistes and casual staff at KBC should be given priority during recruitment,

c onsidering their high qua lific a tions and experienc e.

7. The Board should review KBC s policy on award of c ommissions to its sta ff andensure that the permanent and pensionable members of staff do not draw

any c om missions whether from sa les or revenue c ollec tions.


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8. The Board should c onduc t a n a ud it of a ll KBC a ssets. Moreo ver, KBC shouldmove with speed to obtain all the title deeds of its land with a view of

sa feg uard ing the same aga inst land grabbers and unsc rupulous individua ls.

9.

The Minister for Financ e should take the nec essary steps towards improvingKBCs financial status including restructuring its balance sheet by converting

KBC deb t into equity.

10.The Government should increa se its fina nc ia l support to KBC to ac c elerate thep roc ess of restruc turing and refo rms and enab le it effec tively perform its role a s

a Nationa l pub lic broad c aster.

11.The Gove rnme nt should a s a ma tter of urge nc y negotiate w ith the Jap anesegovernment to write off the Japanese loan acquired for KBC in 1989 for the

purc hase of the Me dium wa ve eq uipm ent which a re obsolete.

12.The Minister for Informa tion and Comm unica tions should rev iew the KBC Ac tCa p 131 in o rder to re-a lign it w ith the Co nstitution in p a rticular Article 34 (4), to

ensure that the National public broadcaster is independent and free from

politica l influenc e.

ACKNOWLEDGEMENTS

The C om mittee wishes to sinc erely thank the Office s of the Spea ker and the Clerk

of the National Assembly for the necessary support and services extended to the

Comm ittee to exec ute its wo rk.

As Co-Cha irpersons, we must tha nk Mem bers of the Comm ittee for their pa tienc e,

sacrifice, and hard work despite their other commitments and tight schedules, in

their end ea vor to d eliberate on this petition.

We must a lso tha nk the sta ff of the Na tiona l Assem b ly for their stea dfast support to

the Co mmittee.


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Mr. Speaker, Sir,

On b eha lf of the joint Comm ittee , I now have the honour and p lea sure to p resent

the Rep ort and Rec om mendations to the House.

Tha nk You,

Signed .

CO-CHAIRPERSON

(HON. JAMES REGE, MP)

Signed .

CO-CHAIRPERSON

(HON. NICOLAS GUMBO, MP)

Date: ....


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The Report was countersigned by the following Mem bers of the Committee:-

1. The Hon. (Eng .) James Rege, M.P. - Co. Chairma n2. The Hon. (Eng .) Nicolas Gumbo, M.P - Co.Chairman3. The Hon. Clement Wamb ugu. M.P4. The Hon. Ma ina Kama u, M.P5. The Hon. Eva ns Akula, M .P6. The Hon. Emillio Ka thuri, M.P7. The Hon. Joshua Kutuny, M.P8. The Hon. Cha rles Kete r, M.P9.

The Hon. Da vid Koe c h, M.P

10.The Hon. Cyp rian O mollo, M.P11.The Hon. Aden Duale, M.P12.The Hon. Prof. Philip Ka loki, M.P13.The Hon. Ad en Keyna n M.P14.The Hon. Ekwee Ethuro, M.P15.The Hon. Edwin O. Yinda , M.P16.The Hon. Pete r Kiilu, M.P17.The Hon. Benjam in Jomo Washa li, M.P18.The Hon. Ged ion Mb uvi, M.P19.The Hon. William Kabogo, MP

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CHAPTER ONE: INTRODUCTION AND BACKGROUND

1.0 INTRODUCTION1.1 Public broadcasting service which includes among others radio, television and

electronic media, exists in many countries. Public broadcasting is funded from

diverse sources including the public, license fees, individual contributions and

commercial fees. Historically in many countries, public broadcasting was the

dom inant form o f b roa dc asting . How ever, priva te broa dc asting now a lso exists in

mo st c ountries inc lud ing Kenya .

1.2 Transmission b y Rad io in Kenya sta rted in 1927 through the East A frica nBroa dc asting Corpo ra tion (EABC) w hich relayed British Broa dc asting Corpo ra tion

(BBC) new s to the c olonies. The broa dc ast servic es ta rgete d white sett lers who

mo nitored new s from Brita in and other pa rts of the w orld . In Sep tem ber 1931, an

agreement was made between the Government and the Imperial and

International Communication Ltd (cable and wireless Ltd.) to take over the

responsib ility o f b roa dc asting for a term o f 25 years.

1.3 First rad io b roa dc asts ta rget ing Africa ns beg an d uring the World War II to informrelat ives of A frica n sold iers of the happenings a t the wa r front. The first b roa dc ast

service for Afric ans- African Broadc asting Services (ABS) - wa s c rea ted in 1953

and a ired prog ramm es in Swa hili and other languages. The te lev ision servic e (TV)

wa s introduc ed in Kenya in 1962. The Voice of Kenya (VOK) wa s na tiona lized in

1964 through an Ac t of Pa rliame nt. The na me wa s c ha nged to KBC in 1989.

1.4 KBC is esta b lished as a pub lic b roa dc aster by a n Ac t of Parliame nt Cap 221. Thefunctions of KBC are among others, to provide independent and impartial

broadcasting services of information, education and entertainment in English

and Kiswahili or in any othe r languages the Corpo ra tion ma y de c ide. The a ims of

KBC a re to inform, educ ate a nd ente rta in the p ub lic throug h rad io a nd television

servic es. The spec ific a ims are to inc rea se understand ing of the g overnment

de velop ment po lic ies and strate gies and p romote a n effective ap proac h to the

use o f rad io a nd te levision a s tools for Nationa l Deve lop me nt.

1.5 KBC currently has about eight hundred and eighty seven (887) permanentemployees and about four hundred (400) artists and casuals employees. It

op erates a TV sta tion a nd over eighteen (18) rad io sta tions. The Ma nag ing

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Director (MD) oversees the day to day running of KBC with the direction of the

Board of Directors which consists of a chairman appointed by the President, the

MD, the Permane nt Sec reta ry for informa tion and Comm unic a tion, the

Permanent secretary for Finance and other members with specialized

qua lific a tions appointed by the Minister.

1.6 KBC has suffered many challenges including administrative challenges, politicalinterference, poor asset management, high debts, irregular recruitment and

promotions, poor working conditions and low wages which have led to a

workforce that is dissatisfied. Owing to this dissatisfaction, for the first time in the

history of the country, KBC employees went on strike to voice their grievances

with a v iew of get ting long term solutions.

1.7 On Thursday 1st of Marc h 2012, two hundred and forty eight (248) KBC e mp loyeespresented a petition to Parliament through the Hon. John Mbadi M.P citing

interference and political influence at KBC; poor employee terms of service; low

wages; and an opp ressive wo rk environm ent . The p etitioners sta ted tha t KBC ha s

been misma nage d lea d ing to b ra in d ra in, loss of reve nue a nd letha rgy am ong st

me mb ers of sta ff. They p rayed tha t Parliame nt investiga tes the c onc erns ra ised

and establishes the factors that have led to the current state of affairs at KBC

with a view of o ffering long -term solutions. The petitioners a lso prayed tha t

Parliament reviews the KBC Act Cap.131 with a view of harmonizing it with the

Co nstitution and streng thening the c om pet itiveness of KBC.

1.8 Follow ing the Spea ker s ruling on the pet ition, the joint Com mittee he ld sittingswith the stakeholders in order to unearth the reasons behind KBCs failures and

provide long term solutions. From the evidence gathered, the joint Committee

c onc lude s that the c orpora tion lac ks bo th po lic y and leg a l framew ork and must

undergo major reforms to transform it into a functioning National public

broadcaster that serves the aspirations of all Kenyans as envisaged by the

Constitution.

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CHAPTER TWO: SUBMISSIONS BY STAKEHOLDERS

2.0 INTRODUCTION

The Co mmittee rec eived oral and written submissions as is p resented here b elow .

2.1 MEETING WITH THE PETITIONERS (KBC STAFF)

Appearing before the joint Committee on March 7th, 2012, the petitioners raised

the follow ing a lleg a tions and submitted w ritten me moranda.

2.1.1 Administrative Issues

(a )Irregula r rec ruitment, appo intments and promotions of staff at KBCThey ra ised the following issues with rega rd to em ployment a t KBC:-

i) That the rec ruitme nt a nd p rom otion p roc ess a t KBC w as skewed due to lac kof a p rop er sc hem e o f servic e.

ii) Recruitments, appointments and promotions of staff at KBC do not follow thedue proc ess. There we re serious a lleg ations of favouritism and granting of

sexual favo urs for employment and p rom otions.

iii) The petitione rs c ited a spec ific c ase which oc c urred in Novemb er 2010whereby all the employees were promoted to higher grades though their

sa la ries we re not inc rea sed in line with the ir new grades. Notwithsta nd ing this

mass upgrade, in August 2011, the Principal internal auditor, finance

ma nage r and the Assistant Ed itor-in-Chief we re prom oted one grade up (SS

BE3 to SS BE2) under unc lear circ umsta nc es. They a lso a lleg ed tha t the

current administration manager who previously served as the Assistant

Human Resourc e (HR) mana ger (grad e SS BA 1) was a lso prom oted to

Ad ministra tion Mana ger (SS BE3) before the ma ss upgrade und er unc lea r

circumstances since the post was never advertised nor any candidates

interviewe d . He w as la ter upgraded to grade SS BE2 afte r the ma ss

promotion.

iv)The Co mm ittee he a rd tha t som e va c anc y ad vertisements we re ta ilor ma deto suit specific individuals. For instance, on 8th April 2010, an advertisement

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was placed in the standard newspaper for the position of the MD and

anothe r one in Ma y for the p osition of the Huma n Resource Ma nage r (HRM).

The qua lific a tions for the HRM req uired the c and ida te to possess a post

graduate diploma in human resource management and a Masters in

Business Administration (MBA) while the MD was required to posses only adeg ree in Soc ia l Sc ienc es1. The p etitioners argued tha t the q ua lific a tions for

MD we re set w ith a spec ific ind ividua l in mind .

v) The p etitione rs sta ted tha t in July 2009, the ma nage me nt a pp rove d theCode o f Reg ula tions (COR) whic h p rovided for, amo ng othe rs, the p ayment

of c om muter allow anc e to a ll sta ff at the rate o f 15% of the ir basic sa la ry. This

was implemented two years later in July 2011. However, before the

implementation of this allowance for all staff, the managers were already

drawing transport a llow anc e a t the ra te of Ksh. 10,000.00 per month. Thepetitioners alleged that the provision in the COR that those a lrea dy drawing

transport allowances would continue earning it at the rate of 15% of their

basic sa lary or Kshs. 10,000.00 which ever was higherwas in favour of the

managers and was done with full knowledge of the fact that 15% of the

basic sa la ry for ma nagers wa s higher than the Ksh.10, 000 they we re a lrea dy

earning.

(b ) The app ointment of an unqua lified Rad io Program mes Manageri) The p etitioners a lleg ed tha t the Rad io Prog ramm es Ma nager Mr. Walter

Mongare was irregularly recruited in April 2010 despite his lack of the

relevant qualifications and that his subordinates had better qualifications

tha n him. They referred to his Curriculum Vitae 2 which showed that Mr.

Mongare holds a Diploma in Graphics (desk top publishing) from Kul

Graphics Institute and is yet to complete his degree at Kenyatta University

(KU) whic h he ha s bee n pursuing since 1996. The petitioners sta ted tha t as a

result of his inadequate qualifications, Mr. Mongare is not fit to provide

lea de rship and ma nag e the de pa rtment.

1Annex2(a)&(b)2Annex3

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(c ) The Plight of Artistes and Ca sua l Staffi) The p etitioners defined the term a rtistes as prov ided for in the KBC Cod e o f

Regulations of 2009, as a public performer or entertainer whose services are

em ploye d by the Corpo ra tion. The COR further sta tes tha t the terms of theartistes sha ll be spelt out in the a rtistes polic y. The terms of eng agem ent fo r

the c asua l em ployees on the othe r hand sta ted tha t the c asua l wo rkers we re

not to b e eng ag ed for a c ontinuous pe riod exc eed ing o ne mo nth and were

not entitled to a ny lea ve, gra tuity, med ic a l c ove r and o ther bene fits.

ii) The petitioners sta ted tha t the artistes we re d isc rimina ted aga inst ye t KBC asa sta te c orporation w as expec ted to trea t a ll emp loyees eq ua lly. The issues

they ra ised with reg ard to KBC a rtistes inc lud e:-

Emp loymentThe petitioners a lleg ed tha t:-

i) Most o f the artistes had served the c orpora tion as tem porary em ployees formo re than the six month stipulate d period with som e e ven w orking for up to

seven yea rs. This, in the ir op inion c ontravenes the Co nstitution and the labour

laws.

ii) The a rtistes were g rossly und erpa id d espite b eing highly qua lified . Moreo ver,the pay day was inconsistent and varied from either the 5th, 10th or 18th

dep end ing o n the signa tories p refe renc e. They further a lleg ed tha t transition

to p erma nent em ployment was not c a rried out in a transparent ma nner but

wa s through nepot ism a nd sexua l favors.

iii) There w as lac k of a sta nd ard polic y on a rtistes. For insta nc e, in somedepartments, artistes were assigned contracts and appraised but this was

not the case in all departments. Further, some artistes such as those in the IT

and ma rketing dep artme nts ea rned KSh. 30,000 and we re entitled tomedic a l and house a llow anc es yet o thers with the same c red entials ea rned

as little as KSh. 17,000.

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Discriminationi) The petitioners a lleg ed tha t the a rtistes we re o ften overworked by assigning

them mostly night shift and weekend duties despite having permanent

employees who were deemed to be more qualified. However, they were

discriminated against in assignments that generate allowances and

c ommissions. Suc h assignm ents were a lwa ys assigned to p ermanent

employees with the excuse that artistes were not permanently employed

and were no t entitled to risk a llow anc e. This d isc rimination extends to tra ining

op portunities and award o f sc holarships.

Inhumane working conditionsi) The p etitioners a lleg ed tha t the a rtistes we re no t entitled to e ither annua l

leave or off days thus subjecting them to long working hours without any

brea k or co mp ensation. They further a lleg ed tha t fema le a rtistes were not

entitled to maternity leave and were only given two weeks off on

humanitarian g rounds. They felt tha t this wa s d isc rimina tion on g ender basis

and an outright infringe me nt of b asic huma n rights and the lab our laws.

ii) They further sta ted tha t the artistes d id not have m ed ic a l bene fits and riska llow anc e a nd presented c ases where som e ha d incurred injuries in the ir line

of d uty but were a ba ndo ned at the a c c ide nt sites or hospital to c a ter for the

ensuing expenses desp ite the ir low wages. The petitioners rec ounted spec ific

c ases of a Mr. Tony Juma , a c ame ra ma n who w as involved in the Eldoret a ir

c rash in Ma y 2009; Ms. Reb ec c a Ma sinde, an e d itor who w as stabbed on he r

way home from work in 2011; and Maryanne Wanjiku a producer who was

involved in a car accident on her way from work. Artistes working on night

shift a t the sta tion or at othe r loc a tions we re denied transport and me a ls.

Corruptioni) It was alleged that KBC deducts Pay As You Earn (PAYE) from the artistes but

doe s not remit the same to Kenya Revenue Autho rity (KRA). The pet itioners

based this allegation on the fact that the artistes are asked to apply for a

new KRA p in number onc e they g et p erma nently emp loyed .

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(d ) Staff VictimizationThe p etitione rs c la ime d tha t the d ep uty proc urement m anager was transferred

from Nairobi to Mombasa under unclear circumstances for being a whistle

b low er. They c la ime d his transfer wa s bec ause he wa s perce ived to b e astumbling block to corruption and procurement irregularities at the KBC

headquarters.

The case of Elyna Wanyika Sifunai) Ms Elyna Sifuna who had been ta ken to c ourt on a lleg a tions of send ing

abusive text messages to former MD David Waweru and the current MD Mr.

Waithaka Waihenya, was cleared of these allegations after the court found

no e videnc e ind ic a ting she w as the send er of the te xt me ssages. She la terfiled a case with the industrial court and was awarded damages and an

order made to the c orpora tion to reinsta te her. The c orpora tion ha s how eve r

refused to lift her suspension. According to the petitioners, the company

sec reta ry be la ted ly filed an appea l aga inst the ruling.

ii) Further, it was sta ted tha t the c orpo ra tion enlisted the leg a l servic es of KinyuaMuriithi and Company Advocates whose legal fee is catered for by the

c orpo ra tion yet Ms. Sifuna ha d sued Mr. Waihenya for defa ma tion in his

persona l c apac ity and not as the c orpora tions MD.

The case of Sylvester Leg ewaMr. Sylvester Leg ew a, who ha d served for a long period of time a s a c ontrac ted

ICT officer, wa s unp roc ed ura lly sac ked from KBC a fter the m anagem ent failed

to sign the document authorizing his pay. Mr. Legewa was neither given a

termination lette r nor notice .

(e)Sexual HarassmentThe Comm ittee me t w ith one of the a lleg ed vic tims of sexual harassment w ho

informed them that the other victims were reluctant to appear before the

Comm ittee for fea r of victimiza tion.

The Co mm ittee he ard tha t:-

i) She joined KBC in 2007 as an intern just b efo re g radua ting from university.7


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ii) She later worked for one and a ha lf years as a c asua l em ployee w ithout p ay.iii) She transferred from rep orting news on T.V to a prod uc er at Me tro FM w here

she w orked und er the a c c used . The a c c used sent her several suggestive

messages and at one time offered to take her on an exotic trip but she

dec lined . He a lso b rought he r g ifts on his return from o ne of his trips which she

accepted.

iv)The a c c used howe ver c ontinually frustra ted he r bec ause o f her unwillingnessto grant him sexual favors by refusing to grant her leave or sick offs (she got

her first leave after 4 years); burdening her with excess work; and addressing

her in vulga r languag e.

v) She c om pla ined to he r superior who ha d ea rlier wa rned her to be wa ry ofthe a c c used - she howe ver neve r pursued the matter.

vi)The vict im fe lt tha t she wa s d isc rimina ted aga inst c onsidering her sa la ry wa sonly Ksh. 27,000 while her colleagues at Venus FM were paid a salary of Ksh.

70, 000. The vic tim ha d strong susp icions tha t th is d isc repanc y was as a result

of her unwillingness to yield in to the demands of the accused, though she

d id not rule o ut a ny other rea sons.

vii)She then sta ted tha t the stud ios a t KBC w ere not sa fe fo r fema le em ployee sparticularly at night considering the security personnel were located far from

the stud ios.

2.1.2 Allegations of flawed procurement processes and malpracticesThe petitioners ra ised a llegations with reg ard to KBC s proc urement p roc ess. The

Board of Management was accused of corruption, procurement irregularities

and w astag e o f pub lic funds as deta iled here b elow .

(a )Irregular engag ement of service p rovidersi) The p etitione rs argue d tha t the a pprova l of a req uest by the Kenya Auto

Elec tric a l Ltd to the Proc urement Ma nager for extension of the c losing da te

for tend ers in its letter da ted 5th Marc h 2012 (REF: KAEL/ KBC/ 12/029) when

KBC sta ff we re o n strike was irreg ular and should b e p robed further. The

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c om pany is how ever not p req ua lified to supp ly equipme nt or any ma teria l to

KBC.

ii) They sta ted tha t the MD had signed a c ontrac t with One Way Clea ningServic es Ltd which was not p re-qua lified for offering c lea ning servic es to KBC.

The p etitione rs ind ic a ted tha t the d eta ils of the c ontrac t we re sc anty but

requested the Committee to further follow up on the transactions through

payments to the c om pany vide C heq ue No. 008744. They w ent further to

req uest tha t the supp lies and ma rketing inspec tor, a Mr. Samson Ond ieki

oug ht to be q uestioned with reg ard to the se suspec t transac tions.

iii) They further alleg ed tha t tend ers we re b eing a wa rded a t infla ted c osts forsome services that could be undertaken internally by the employees. For

instanc e, Turnkey servic es had bee n pa id hug e a mo unts of money for a TV

program me tha t co uld ha ve been p rod uced by highly qua lified pe rsonnel at

KBC.

iv)Desp ite KBC und ertaking tend ers for sup p ly and insta lla tion, KBC Sta ff we resometimes directed to implement the tasks on behalf of the bidder despite

the tender do c uments indica ting c lea rly wha t wa s expec ted of the b idd er.

v) The p etitioners a lleg ed tha t KBC ha s eng aged law firms without tendering yetit has a fully fled ge d lega l dep artment.

(b )Tenders awa rdedThe pet itioners a lleg ed tha t a ma jority o f the luc ra tive Tend ers a t KBC a re

awa rded in favour of five c om panies assoc ia ted to one ind ividua l.

The tenders awa rded to these c om panies ac c ording to the petitione rs inc lude:-

i. A tend er for TV virtua l set a wa rded to Grand photo lab which the petitione rsa lleg ed had been va ried from KSh 16m to about KSh. 50m without

competitive bidding.

ii. A te nd er for FM Transmitters (Kuria , Webuye , Kisumu and Kisii) which wasseparated into two tenders, one for transmitters and one for antennas and

aw arde d to Grand Photolab and York investmentsfor ab out KShs. 50m.

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iii. FM Transmitters for Verna c ular sta tions (Luo , Luhya , Kisii, Ka lenjin etc .) wereaw arded to the sam e two firmswithout c ompe titive tendering.

iv. A tender for ana log ue TV Transmitters was awa rded to the same firmsa t ac ost of about KSh.100m.

v. A tender for d ig ita l TV transmitters wa s awa rded to C ent ra l Works Co mp anyat a c ost of a bout KSh. 280m. A d ow n payme nt of KShs. 88m w as pa id out to

the c om pany d uring the KBC sta ff strike.

The p etitione rs a lleg ed tha t the eva lua tion fo r mo st of the above tend ers wa s

done with the assistance of two University of Nairobi (UoN) lecturers, Prof M.K.

Wamangoli and Dr. Elijah Mwangi, yet KBC has the capacity to carry out the

eva lua tion. They further a lleg ed tha t the tea m was appointed d irec tly and

unprocedurally by the tender committee. According to the petitioners, the

source of specifications and evaluation criteria are suspicious in view of the

above.

(c )Inspec tion and Ac ceptance Committeei) The p etitioners sta ted tha t they found it pec uliar tha t, a M r. Fred Akoko, wa s

not involved in the Inspec tion a nd Ac c ep tanc e of eq uipments from supp liers

despite a m em o from the CEO a ppointing him to the mem bership o f the

Inspection and Acceptance Committee dated 28th July, 2011 (REF:KBC/MD/12/6/C).

(d )Conflict of Interest on the part of Board Membersi) The petitioners c la imed tha t Broadc ast Solutions Inte rna tiona l Limited (BSI), a

c ompa ny owned by a bo a rd mem ber, Mr. Steve Areba , wa s pre-qualified to

sup p ly eq uipment fo r the years 2011-2013. They sta ted tha t BSI was hosting

Pan Africa Media Network, the second licensed multiplex company at KBCs

Gatimu site in Limuru despite the company expressing interest in beinghosted by KBC a t the Limuru Transmission. The petitioners a lleged the

existenc e o f a lette r with reg a rd to this req uest.

ii) The pet itioners a lleg ed tha t Hope FM w ithdrew their transmission eq uipmentfrom KBC Limuru Transmitter sta tion to the BSI site in Gatimu between 4th a nd

6th August 2011 as a result of verbal instructions from the Assistant Manager

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Tec hnica l Servic es (AM TS) Mr. Tom Buluku to the Eng ineer-In-Cha rge Limuru

Transmitte r.

iii) It was alleged that another Board member, Mr. Ben Gituku also sits on theboard of the Radio Africa Group which was a clear case of conflict of

inte rest. The p etitioners insinua ted tha t this c ould ha ve had a bea ring on the

controversial deal between KBC and Radio Africa over the exclusive FIFA

2010 World Cup rights that was currently a court case (former MD David

Waweru and forme r Comp any Sec reta ry Hezekiah Oira we re sac ked from

the c orpora tion a nd arraigned in c ourt ove r the matte r).

(e)Commission paymenti) The petitione rs c la imed tha t c ommission payment from the proc eeds of live

broadcast of Parliamentary proceedings was irregularly done contrary to

claims by the acting finance manager that the Corporation has been

paying the Parliame nta ry Broa dc asting Unit (PBU) sta ff mo nthly a llow anc es.

ii) The petitione rs req uested the Comm ittee to investiga te the ma tter andesta b lish the benefic iaries of these a llowanc es since 2008. They further

ma de a p lea to the Committee to c ompe l KBC to immed ia tely pa y all the

PBU staff the requisite allowances backdated to the commencement of

the p arliamentary live p roc ee d ings in 2008.

(f) Suspic ious increase in wea lth o f employeesi) The p et itioners a lleg ed tha t the soc ia l sta tus of som e o f the managers ha d

radically changed in the short period they had been in the Department.

They req uested the Com mittee to p rob e the source of their we a lth and

spec ific a lly how the had a c quired vehicles and prop erty. They c autione d

that the excuse of loans could be used to camouflage corrupt deals

amongst som e managers.

The p etitioners were c onc erned tha t the Minister for Informa tion and

Communications had not invited the Efficiency Monitoring Unit (EMU) and/or

Ethics and Anti-c orrup tion C om mission (EACC) to investiga te these c la ims which

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they had presented to him o n 8th Decemb er 2011 in a mem orand um signed by

315 sta ff.

They req uested the Com mittee to rec om me nd the suspension o f any c orrup t

manager and freeze their bank accounts until the investigations were

completed.

2.1.3 Poor organizational Structure and financial management

The C om mittee hea rd that;

i) KBC is heavily inde b ted ;ii) There is a deliberate a ttemp t by the Ministry to c ause the c ollapse o f KBC

since the PS openly favours ICT dep artments.

iii) Postal Corporation of Kenya (PCK) and the Kenya Institute of MassComm unic a tion (KIMC) we re som e of the orga niza tions being m arg ina lized

by the Ministry.

(a )Mismanagementi) The p etitione rs a lleg ed tha t there wa s misma nage ment a t the c orpora tion

through creation of units that added no value to the core business of KBC

and we re hea ded by personne l earning huge sa la ries yet the ir roles we re not

c lea rly de fined . For instanc e, in the m arketing and rad io d ep artment.

ii) They further pointed out the merge r of the ICT and tec hnic a l dep artme ntswhich in their opinion was an amorphous unit that was headed by an ICT

person w ith no req uisite b ac kground in b roa dc ast eng ineering.

iii) The p etitione rs pointed out tha t the wo rkshop a t KBC tha t was intend ed forpreventive maintenance, repair and testing of KBC transmission and

production equipment and which was to be equipped with standard repair

tools, repair kits and instruments to undertake the said works under

international standards had been abandoned and neglected and only

c arried out p iec emea l wo rks.

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iv)They w ere d isma yed a t the c losure of Metro FM w hic h a t the time of c losureha d the highest listenership o f a ll the KBC rad io sta tions.

(b )The ICT and Tec hnic al Dep artmenti) Ma jority of the ICT office rs ha d no job desc riptions. This ha d left the m

vulnerable to harassment and malpractice especially during appraisal

ta rget sett ing. The p etitioners a lleg ed tha t only selec ted ind ividua ls ha ve

job desc rip tio ns.

ii) There is a g la ring lac k of ICT and tec hnica l ma intenanc e to ols in keyoperation areas coupled with lack of well equipped workshops for

eq uipme nt testing a nd maintena nc e. The tec hnic a l c ha lleng es inc lude:-

Lac k of suffic ient ha rdwa re suc h as c om puter, p rinte rs and sc anners etc ;Inadeq ua te wo rksta tions for all sta ff memb ers;Lac k of licensed Softw are; andLac k of p rop er server rooms with effic ient bac kups

2.1.4 Changing Tec hnologies

The p etitioners a lleg ed tha t KBC a s the imp lem ent ing agenc y of the Task force

on digital migration had not provided leadership nor created capacity for a

c om prehensive migration p lan. They ac c used the c orpora tion of ab d ic a ting its

responsibility of migration to foreign companies in total disregard of its national

ma nda te. They c ited som e g la ring a noma lies tha t c rea ted c onfusion a s:-

i) Lac k of direc tion and imp etus in the fo rma tion o f a Signa l d istributioncompany.

ii) Purc hase o f ana log ue TV transmitters desp ite the stipulate d ana log ue switc hoff d a te sla ted for 30th of June 2012. The c orpora tion a lso awa rded tend ers

to a loc a l c ompany to supp ly d ig ita l TV transmitters tha t were untested and

had no loc a l or internationa l reference fo r p roo f of qua lity.

2.1.5 Some othe r genera l issues ra ised by the petitioners inc lude :-

i) The petitioners ac c used the PS and Minister of m icro managing KBC a ndsupporting the recruitment of persons who lacked in suitable qualifications

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including both education and experience for the positions assigned to

them.

ii) KBC had more managers than non-manager employees and that theintention w as to suppress the em ploye es from joining the Union.

iii) Most sta ff at KBC ha d stagna ted in one p osition c onsidering promotion wasused as a tool of reward for syco pha ncy by the ma nag eme nt.

iv)The manage me nt wa s intolerant to staff which had c onseq uently led tobra in drain a t KBC.

2.1.6 The p etitioners drew the follow ing c onc lusions and rec om me nd ations:-

i) That the re are gross ma lp rac tic es a t KBC which c a ll for imm ed ia te ac tion.There is a lso a n urgent nee d to p revent any ob sta c les to investiga tionincluding but not limited to the stepping aside of officers implicated in the

dubious deals and suspension of all contracts until procurement processes

are investiga ted .

ii) There should be strict a dherenc e to the KBC rec ruitment polic y andestablishment of procedures that take into consideration gender

mainstreaming.

iii) There is need for ap pointment of rad io a nd television experts to the KBCBoard of Directors to effectively assess candidates for radio and television

jobs. The sta ff a lleg ed tha t the Rad io department ha d fa llen vic tim to

inc ompe tent ma nag ers be c ause o f fa ilure to have bo ard mem bers who are

we ll versed on b roa dc asting ma tters.

iv)KBC should update its scheme of service in order to target the rightc and ida tes with spec ific qua lific a tions.

v) The a rtistes and c asua l em ployee s should b e e mp loyed on p ermanent a ndpensionable terms to fill the current vacancies based on their credentials,

yea rs of servic e a nd the roles p layed within the c orpo ra tion. The a rtistes and

casual staff should be better paid and be entitled to medical and house

allowances.

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vi)The petitioners c a lled for investiga tions to esta b lish the justifica tion fo r hiring apriva te c om pany - Tysons Limited and Inte rlink to ma nage the KBC Housing

scheme yet KBC was able to manage the scheme by recovering the rent

from the sta ff throug h the pay roll.

2.2 MEETING WITH THE KBC BOARD OF DIRECTORS AND MANAGEMENTThe joint Comm ittee me t with the KBC Boa rd of d irec tors and ma nagem ent on

Thursday Ma rc h 8, 2012. During the me eting , they responded to the follow ing

issues tha t ha d bee n ea rlier ra ised by the pet itioners:-

2.2.1 REASONS THAT LED TO THE STRIKE

(i) The mana ge ment a dm itted that they w ere a wa re tha t the KBC staff fac edseveral problems including low salaries, stagnation and poor working

c ond itions. They believed tha t these w ere the rea sons tha t led to the strike

c onsidering the y had p lagued the o rganiza tion for quite some time.

(ii)They how ever sta ted tha t though they were g rea tly co nc erned w ith thesec ha lleng es, the c orpora tion wa s financ ia lly stra ined and wa s therefore not in

a position to pay its staff well, purchase equipments and cater for other

op erational expenses. The m anage ment strong ly believed tha t financ ia l

challenges were the main cause of these problems and an increase in

financ ia l alloc a tions wo uld grea tly c ontribute to add ressing these prob lem s.

(iii)The m anag eme nt further stated that they ap p rec ia ted the staffs c onc ernssince they were genuine but they were not agreeable to the channel the

sta ff used to ra ise their c onc erns.

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2.2.2 ADMINISTRATIVE ISSUESa) Promo tions and ap pointments of staffWith respect to KBCs recruitment and promotion policy, the Committee was

informe d tha t:-

i) In 2007, KBC c ommissioned the Fed eration of Kenya Emp loyers (FKE) to c arryout an organization review and job evaluation exercise whose findings are

contained in a report dated November, 20073 which recommended

amo ngst o thers, the re-alignment o f the sta ff com p lem ent of KBC.

ii) The sta ff misunderstoo d the rec om mendations c onta ined in the rep ort tomean that the ir remuneration w ould b e increased . They how eve r sta ted tha tthe boa rd was wo rking on a system to imp rove the sa la ries of the sta ff.

iii) There ha s never bee n ma ss prom ot ion o r rec ruitment of sta ff as a lluded to bythe petitioners.

iv)The manag eme nt app rec ia ted that KBC ha s a la rge workforc e a nd therewa s a need for sta ff harmoniza tion.

v) With respect to the specific claims by Mr. Milton Nyakundi, the MD statedtha t Mr. Nyakundi ha d persona lly sub mitted his resigna tion lette r to him. The

MD informed the Com mittee tha t he tried to p ersuade Mr. Nyakundi ag a inst

resigning but he wa s adama nt on his dec ision and the MD therefore wished

him w ell.

b) The app ointment of Mr. Walter Mongare as Rad io Program mes Manag er.The m ana ge ment informed the Co mmittee that the Rad io Prog rammes

Manager Mr. Walter Mongare was on a three (3) year contract and not on

3Annex4

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pe rma nent a nd pe nsiona ble terms as a lleg ed . Mr. Mong a re w as employed on

a ta lent b asis based on a dec ision b y the Boa rd to source and emp loy a person

based on his/ her talent in order to improve the rad io sec tion.

The manage ment conc urred tha t Mr. Mong are only held a Dip lom a in printingbut they we re o f the op inion tha t he was qua lified c onsidering he had seve n (7)

yea rs experienc e. They further sta ted tha t sinc e his appointment, the rad io

de pa rtment had imp roved .

The Ma nag eme nt tab led the job d esc ription4 of the Radio Programmes

manager.

c ) Spec ific ac tion undertaken by the Management to improve staff welfareThe KBC Boa rd and ma nagement sta ted tha t they ha d undertaken seve ra l step s

to imp rove the we lfare of its sta ff. Most no tab le of w hic h were:-

(i) Introd uc ing sta ff com mute r a llow anc e in 2010.

(ii)Inc reasing sta ff remunera tion b y 21% throug h a 9% pay ra ise in Februa ry 2012and a further inc rement o f 12% which wa s bac kda ted to July 2011.

(iii)Com menc ing the p roc ess of p roc uring med ic a l cove r for the emp loyees.

(iv)A c ar loa n sc heme wa s introd uced and efforts a re und erwa y to introd uce amortga ge sc heme.

(v)While appreciating the deplorable conditions of studios and offices at KBC,the management assured the Committee that efforts were underway to

refurbish the newsrooms.

4Annex 5

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d)The plight of Artistes and Casual staff.The Comm ittee heard tha t the Co rporat ion hires a rtistes as p rov ided for in the KBC

Ac t Ca p 221. The ma nag eme nt ad mitted that they we re d ep end ent on the a rtistes

who we re highly qua lified and eve n mo re skilled than the p ermanent sta ff.

The m anage me nt d ra fted a polic y on artistes and c asua l sta ff in 2011 and

therea fter issued a c irc ular for rec ruitment of c asua l sta ff who had served for a long

period of time. They w ere awa re tha t som e o f the c asua l sta ff had served for ove r

eight (8) yea rs and they ha d therefore sta rted the proc ess of filing vac ant p ositions

by hiring c ausa l em ploye es.

The ma nag eme nt informed the Com mittee tha t on 7th

March 2012, they hadc om menc ed the p roc ess of issuing a ll the c asua ls with a three (3) month c ontrac t

as an interim m ea sure b efo re regula rizing the anoma ly. They further sta ted tha t

they had c om missioned an aud it o f all KBC sta ff in orde r to e sta b lish the number of

staff and the op timum numb er to b e ma intained .

The MD a ssured the Comm ittee tha t KBC w ill give p riority to the rec ruitment o f

casual employees depending on availability of funds. He also gave an assurance

that he would investigate the claims leveled by the petitioners that the

management compelled the casual staff to acquire new PIN numbers during

extension o f their c ontrac ts in an e ffort to avoid p aying ta x and e mp loyment law.

The MD ma de a c om mitment to further investiga te the c la ims ma de b y the

petitioners that the employees injured in the line of duty were abandoned and in

particular the case of the cameraman who was left unattended by a manager

a fter the p lane c rash.

e) Allegations of sexual ha rassmentThe Ma nage ment informed the Comm ittee tha t sexual harassment was listed as an

offence under the KBC Code of Regulation.They how ever c la imed that they had

not rec eived any offic ia l rep orts of sexual harassme nt b ut gave an und ertaking to

ta ke serious ac tion aga inst any perpe tra tors.

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2.2.3 PROCUREMENT ISSUES(a )The 2010 FIFA World Cup rights saga

The Cha irma n informe d the Com mittee tha t:-

(i) KBC was embroiled in a court case with Radio Africa Ltd. over the 2010 FIFAWorld Cup rights.

(ii)The Boa rd was aware o f the a lleg ation tha t one o f the KBC d irec tors, Mr. BenGituku, also sits on the Board of Radio Africa Group. Following these

allegations, the Board held a meeting to establish the truth and confirmed

the a lleg ations we re no t true.

(b )Conflict of interests by some Directors of KBC by transacting business with KBCi) The C ha irma n of the Boa rd of KBC informe d the C om mittee tha t to his

knowledge, none of the Directors currently transacted any business with

KBC. He sta ted tha t a t one time , one o f the Direc tors Mr. Step hen A reb a

had requested to transact business with KBC but his request had been

turned do wn. He however ac knowledg ed be ing a wa re that Mr. Areb a ha d

prev iously through his c ompany, Broadc ast Solutions Inte rna tiona l Ltd (BSI)

held a c ontrac t with KBC b ut this wa s no long er the c ase.

ii) The MD how ever gave a different a c c ount by confirming that indeed therewas an existing c ontrac t b etwee n KBC a nd BSL Ltd for co-sighting b ut the

c ontrac t had be en drafted long be fore Mr. Areb a ha d joined the Boa rd.

iii) The Committee noted the d isc rep anc y betw een the evide nce of the MDand Chairman of the Board and requested to be availed with additional

information 5.

(c )Tendering and Pre-Qua lification of Com pa nies by KBC

5 Annex7

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i) The Com mittee hea rd tha t none of the c om panies pre-qua lified by KBCwere ow ned by the sam e individua l or had c ompeted ag ainst eac h other on

the sam e tend er. The ma nag ement however stated that they we re a wa re o f

a supplier whose three (3) companies were awarded tenders but they were

c ate go rica l that these c ompanies did not c ompe te on the sam e tend er.

ii) They sta ted tha t the sa id supp lier ha d wo n two (2) tend ers through his threecompanies, Grand Photolab E.A Ltd; York Investments Ltd; and Leon

Insuranc e Co mp any. They further expla ined tha t York Investments Ltd ha d

won two (2) tenders; Grand Photolab E.A Ltd had won one (1) and Leon

Insuranc e Co mp any had wo n two (2) ove r a p eriod of two (2) yea rs.

iii) With respect to Kenya Auto Electrical, the management clarified that thecompany had not been approved as a supplier considering the tender in

question was still in p roc ess. They d enied the a lleg a tion tha t the re we re

a lterations of te nder do c uments in favor of Kenya Auto Elec tric a l.

(d )Misap prop riation o f funds from the Parliam entary Broad casting ServicesThe Co mmittee heard tha t KBC rec eives Kshs. 15 million every mo nth from the

Kenya Na tiona l Assem b ly (KNA) for live c overag e o f Parliamentary proc ee d ings.

The m anag eme nt stated that the funds were used to p urc hase new c am eras.

With respec t to the a lleg ation tha t a c om mission of Kshs. 200,000/ - is pa id to one

of the senior ma nagers a t KBC, the ma nage ment respond ed by sta ting tha t:-

i) KBC had a policy on payment of commissions for revenue collection as perthe set targets. Considering therefore that Parliament was one of the sources

of revenue, a commission was paid from these proceeds to the KBC

emp loyee in c harge o f the Parliam enta ry ac c ount.

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ii) The c om mission w as poo led and d istributed to a ll the sta ff invo lved with thepa yment rates dep end ing on the em ployees job g rad e. The ma nag ement

was adamant that it was impossible for only one individual to receive the

funds.

The Co mmittee no ted the c ontrad ic tion w ith reg a rd to the p ayment of these

commissions and requested the MD to avail a report indicating how KBC utilizes

funds from the KNA for the live Parliame nta ry broa dc asts6.

(e )Drastic change in social status of allegedly corrupt KBC staffWith rega rd to this issue, the MD undertook to ava il to the Comm ittee c op ies of

dec la ra tion of inc om e, assets and liab ilities for the last three yea rs of som e o f themanagers who had been mentioned as individuals whose social status had

drastic a lly c hanged within a short period of time 7.

2.2.4 ORGANIZATIONAL ISSUES(a )The c losure o f Metro FM and estab lishment o f Venus FMOn this partic ula r c onc ern, the Com mittee w as informed tha t:-

i) Metro FM w as one of KBC s c om me rc ia l rad io sta tions with the spec ia liza tionof reg ga e m usic but its revenues had be gun d rop ping d espite the fac t tha t it

had a huge listene rship . The m anagement e xp la ined tha t the reduc tion in

revenues wa s as a result of the withd rawa l of a dvertisers bec ause the y didn t

wa nt to b e a ssoc ia ted with the Rasta farian lifestyle.

ii) Follow ing this situa tion, the boa rd c onsidered the prop osa l of c hang ing andre-eng ineering the sta tion. The m ana gem ent s p rop osa l of estab lishing a

6Annex87Annex9

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women only station was approved by the board and therefore, Venus FM

wa s launched.

iii) Venus FM uses the same freq uenc y previously used by Me tro FM a nd thoughthe sta tion w as a lrea dy on-air, it had not b een offic ia lly launc hed .

iv)The hea d of the station had be en a pp ointed on a n ac ting c ap ac ity. Themanagement stated that they had re-assigned some members of staff of

Metro FM to o ther dep artments and tha t nob od y was sac ked o r vic timized .

v) The c urrent revenues from Venus FM w ere KShs. 4 million p er month but thisamo unt w as projec ted to rise to KShs 15 million per mo nth a s wa s the c ase

with Rad io Ta ifa.

vi)The ma nag ement de nied the alleg ation that the ma rketing d ep artmentdeliberate ly led to the c losure o f Met ro FM b y failing to raise revenue.

(b )Illegal use of KBC frequenc ies by o ther stationsThe Committee hea rd that there wa s an ag reem ent w ith Ghetto Rad io for

usage of the KBC frequency. Under this agreement, KBC was to receive somepayments but the agreement has since become void as the station is currently

leasing the freq uenc y from KBC a t Kshs. 0.5 million p er month.

The Ma nag ement d enied knowled ge of an ag reeme nt betwe en Hop e FM a nd

KBC for the former to utilize KBC s freq uenc ies.

(c )Illegal d isposal of KBC landThe m ana gem ent w as not awa re o f any KBC land d isposa l sinc e 2005.

2.2.5 TECHNICAL ISSUES

The C om mittee hea rd that:

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i) KBC has suffered from lack of financial support from the Government andthat the government frequently requested for live coverage of its functions

without pay for the same or even a ir government advertisem ents with KBC.

ii) The Mana gem ent o f KBC was of the view tha t since KBC p erforms the role o fa pub lic b roa dc aster, which is not p rofitab le, the go vernment should issue a

circular compelling all government agencies, to place 20% of their

advisements with KBC in a similar way the government has compelled

go vernment agenc ies to use pub lic fac ilities like c onferenc e c ente rs.

iii) KBC ha s not yet c onc lude d the me rge r be twee n the ICT and the tec hnic a lservic es and tha t the same wa s still being d eliberate d upon. The rat iona le

be hind the p lan wa s the c onflic t betwe en the ICT de pa rtment a nd thetec hnic a l Servic es dep artment and there wa s therefore a need to m inimize

this c onflic t. The issues are still be ing ha nd led by the Board .

2.3 EVIDENCE BY MINISTER FOR INFORMATION AND COMMUNICATIONSThe M iniste r for Info rma tion and Co mmunica tions the Hon. Samuel Poghishio,

EGH, M.P appea red before the Comm ittee on Tuesday Ma rc h 13th 2012. The

Minister was ac c ompanied by the PS in the Ministry, Dr. Bita nge Nd em o, CBS.

The M inister informed the Comm ittee tha t when he too k offic e a s Minister, herealized that KBC was facing several challenges and he has since assuming

offic e, b ee n w orking tow ards add ressing these c ha lleng es.

i) According to the Minister, it was unclear whether the staff and artisteswithdrew their services or they had gone on strike. In his opinion, the artistes

had left KBC because they didnt want to work there anymore. He was

however of the opinion that the strike was caused by a failure by the

ma nag ement to p ay the staff an allowa nce .

ii) The M inister sta ted tha t five (5) yea rs ago he wrote a c ab inet memoreq uesting the Trea sury to fund KBC. The c ab inet mem o w as howeve r not

approved. He explained that a Cabinet memo cannot be discussed at the

cabinet if it has any financial implications until the Minister for Finance

c ounter signs it.

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iii) The Minister ac know led ge d that indeed KBC ha d a huge deb t whichemanated from a loan acquired to purchase medium wave equipment in

1989. He expressed his frustration that this equipment consumed high power

c osts lea d ing to reg ula r d isc onnec tions by KPLC d ue to fa ilure b y KBC to pay

for the high power bills. He however reiterated that power expenditure hadsignific antly d rop pe d due to the piec emea l migration to FM freq uenc y and it

was p rojec ted to eventua lly d rop from KSh. 30 Million to KSh. 3 million.

iv)With reg a rd to d igital migra tion, he informed the Com mittee tha t Signa tewas currently managing the analogue to digital migration process and that

Nairobi, Naivasha and Eastern were already complete. It was further

expected that Kisumu and Nakuru would be complete by the following

month.

v) It was unfortunate that the labour and salary issues had not been welladdressed. He stated that the corporations employees continued to earn

the same salaries since VOK changed to KBC and at some point earned

even less tha n pub lic service sta ff ra tes.

vi) In his opinion, KBC has a large number of employees as compared to thosein the private media houses. Despite an earlier retrenchment exercise,

approximately 1400 employees still remained in the employment of the

c orpo ra tion c onsuming a huge w age b ill. This informed the Boa rd s dec ision

to pay a few management staff contrary to the agreement that the massprom otion in 2011 should not have any fina nc ia l imp lica tion. The selec tive

payment resulted to a c omp la int by the sta ff and w as the ma in trigg er of the

strike. This has sinc e b ee n resolved through the bac k to work formula a nd the

PS is following up on the same w ith Trea sury.

vii)The Minister assured the Com mittee tha t he ha s c a lled for a thorough aud itprocess to investigate alleged corruption in the procurement process at KBC.

The Minister und ertook to further investiga te a lleg ations of c onflict of inte rest

and c orruption at the b oa rd level and de al with it ac c ordingly.

viii)The Minister c onc urred tha t it wa s through the strike tha t the Ministry c ameto the rea liza tion tha t KBC w as being run b y the artistes. He w as agree ab le to

the petitioners claim that it was illegal for the artistes to work for a long

period of time on temporary contracts. He however stated that the process

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to correct this il legality had begun through permanent employment of

a rtistes who were h ighly qua lified and thus very resourc eful to KBC.

ix) The Minister sta ted tha t the COR which wa s ac c ep ted by the boa rd ha dfinancial implications of about Ksh. 490 million. He recommended increased

funding from Trea sury and ma de a p lea to the Comm ittee to o ffer their

support in lob bying for inc rea sed funding to ena b le KBC m ee t its b roa dc ast

obligations.

x) The Minister wa s c a tegoric a l tha t the strike was illeg a l and tha t thegovernment had permitted the staff to join the union which they had

d isowned. This forced the Ce ntral Organiza tion o f Trade Unions (COTU) to

withd raw their servic es and c lassify the strike a s illeg a l althoug h the union fee

had a lread y been ded ucted.

xi) The Minister made the c om mitment to restruc ture the Corporations boa rd inorder to recruit new board members with relevant qualifications and

experienc e. The Com mittee d irec ted the Minister to present to Parliame nt

the list of the rec onstituted boa rd and their CVs.

xii)The Minister and the PS sta ted they ha d no knowledge of the a lleg ed sexualharassment at KBC. He found it unfortunate that these claims of sexual

ha rassment were never ra ised during his meet ing w ith the KBC Sta ff. He

recommended that after investigations the offenders should be sacked and

punished.

xiii)The PS denied any relat ions to Mr. Walter Mong are a nd invo lveme nt in hisrec ruitment a s the Rad io Prog ramm es Ma nager. As far as the PS wa s aware,

Mr. Nyambane was hired after the former MD had reviewed the ratings of

KBC and recommended hiring of a competitive presenter such as was the

c ase a t Classic FM.

Follow ing the m eeting, the Com mittee noted that:-

i) Som e o f the artistes we re mo re qua lified than p ermanent KBC e mp loyeeswho were not technologically compliant and there was therefore need to

rec ruit the artisans as perma nent sta ff.

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ii) The p urc hase o f the ob solete med ium wave tec hnology wa s irreg ular andmust b e lega lly addressed . It was therefore rec om mended tha t in future, any

modernization equipment purchased by KBC should be internationally

accredited.

iii) Trea sury should a lloc a te a c ertain am ount of mone y to KBC to ena b le it runas a Nationa l pub lic b roa dc aster.

iv)KBC should b e rename d and an op timum num ber of professiona l sta ff shouldbe established.

2.4 EVIDENCE BY FORMER MANAGING DIRECTORS OF KBC

Three former MDs of KBC a ppea red sep ara tely be fore the joint Comm ittee on

Tuesday Ma rch 20, 2012.

2.4.1 Mr. Clax ton Munywoki

Mr. Munywo ki informe d the Com mittee tha t he was the MD for Tana and A thi

River Development Corpora tion (TARDA) befo re t ransferring to KBC a s the

deputy MD from January 2000 to July 2001. He served as MD for 8 months from

July 2002 to April 2003 before being suspended pending investigations in a

ma nner he d eem ed to b e unprofessiona l.

The fo rme r MD out lined the fo llow ing as the m ain prob lem s fac ing thec orpora tion a c c ording to his perspec tive a s a forme r MD.

i) KBC finances Mr. Munywoki stated that the main revenue of KBC wasdrawn from rad io and TV lic enses and a few c om me rc ia ls. He reiterated tha t

the c anc ella tion o f the T.V and rad io levies adversely affec ted the

c orpo ra tion s revenues. He further informed the C om mittee tha t the KSh.

8billion Japanese loan for the MW equipment received in 1987, had

inc rea sed to Ksh. 23b thus heavily increa sing the c orpo ra tion s deb t. The

former MD stated that KBC had revenue of about 1.2billion but anexpenditure of Ksh. 1.9 billion thus they corporation perpetually operated on

a d efic it.

ii) Bloa ted wo rkforce -The Corpora tion ha s a b loa ted wo rkforce which ha scontinued to increase due to myriad reasons including political pressure and

influenc e on ma nage ment to emp loy more sta ff. The former MD sta ted tha t

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there were 1200 employees, 800 of them being permanent leading to a

huge wa ge b ill of about Ksh. 850million.

iii) The e quipment a t KBC w as ob solete inc lud ing the Med ium Wave (MW)equipment procured from Japan. He proposed the acquisition of new UHFtransmission equipment.

iv)Nega tive perception- Mr. Munywo ki c ited the neg a tive p ercep tion of KBC asa government mouthpiece hence leading to advertisers failure to air their

advertisem ents through the Corpo ra tion. In add ition, the p ub lic a lso g ive little

listenership to the station because they perceived the stations news to be

skewed and biased towa rds go vernment.

v) Interferenc e- He rec ounted instanc es whereb y instruc tions were issued to thema nagement to c ensor som e b ulletins.

vi)KBC Ac t- An outd ated and restrictive KBC Ac t.Mr. Munyw oki prop osed the follow ing solutions to the c ha lleng es ra ised . Tha t:-

i) In order to revive KBCs financial status, the government should write offthe Jap anese d eb t a nd rep lac e the ob solete e quipm ent.

ii)

Experts should be engaged in order to comprehensively restructure KBCso as to reduce the bloated workforce and huge wage bill as was the

case was with Post-Bank. Following this restructuring, the government

should upgrade the Corporations status from grade D to B considering its

imp ortant role of a na tiona l b roa dc aster.

iii) Modern equipment should be procured so as to increase efficiency andreduce the huge power costs which currently add up to about Ksh. 200

million monthly.

iv)The g overnment should refrain from inte rferenc e in the operations of thecorporation in order to improve its image. He reiterated that the

recruitment of both senior and junior positions should be strictly based on

me rit and not p olitic a l influenc e.

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2.4.2 Mr. David Waweru

Mr. David Waweru was the KBC MD from August 2006 to 2010 when he was

sac ked follow ing the c ontroversia l 2010 world c up FIFA rights awa rd .

i) Mr. Waweru informed the Committee that during his tenure, a policy onrec ruitment, appointme nt and p rom otion was in plac e. This wa s ra rely

adhered to due to political interference in the management of the

corporation. He cited influence in simple procedures such as transfers and

promotions bec ause some employees had po litic al go d fathers .

ii) According to Mr. Waweru, employment of casuals at KBC was done ondemand basis by the personnel manager with the approval of the board.

This however left loopho les for abuse.

iii) Mr. Waweru stated that there were no official reports of sexual harassmentbut it wa s wide ly believed tha t suc h c ases we re likely to o c c ur in the stud ios

at night. The personne l manager co untered the possib ility of the oc c urrenc e

of this vice by ta king the em ploye es for d isc ussions on mo ra ls and d isc ip line

from time to time.

iv)The tendering a nd rec eipt c ommittee w as intac t during his tenure and therewere no cases of misappropriation of funds or corruption in the tendering

and procurement processes. He however clarified that during his tenure, a

board member by the name Mr. Ben Gituku was also a distributor of Radio

Africa s Sta r newspaper.

v) He admitted that there was some political pressure on the management butit was dependent upon the management and the board to succumb to

suc h p ressure.

vi)Mr. Waw eru sta ted tha t the sa les c om mission struc ture a t KBC w as approved

by the MD and that during his tenure, he ensured that the structure was

analyzed by the internal audit team before he signed it. As regards to the

pa yment d one by Parliam ent to the c orporation, he stated that a n Eng.

Gichina Kanyi wa s best p lac ed to p rovide deta ils.

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vii)He was of the opinion that metro FM was a youth station but was neither aprofit making nor a loss making station. According to him, it was a good

sta tion tha t should not ha ve b een c losed .

viii)With regards to the FIFA 2010 World Cup rights which was currently in court

and had caused his sacking together with the then corporation secretary,

Mr. Waweru explained that the terms of the agreement between KBC and

Radio Afric a Ltd . were exclusive to TV rights and KBC w as the refo re a t libe rty

to sell the audio rights to other stations. In line with this, the corporation sold

rad io rights to Roya l Me d ia services (RMS) and Milele FM rad io. Mr. Waweru

further a ffirme d tha t the c orpo ra tion d id not rec eive fund ing of KSh. 70 million

from the Go vernment as a lleg ed to purc hase the FIFA rights.

ix)Mr. Waweru claimed that he had made several reforms during his tenure asMD inc lud ing ;-

Retrenchment of the bloated staff 6 months into his employment. He alsointroduced performance contracts in order to establish a lean and qualified

workforce.

Refusing to misuse the frequencies of the station for political expediency bythe gove rnment. This wa s the c ase espec ia lly d uring the 2007 elec tions in

which he c a teg oric a lly refused the m isuse o f the c orporation freq uenc ies by

PNU for politic a l ga in.

He instituted c ost cutting mea sures in the o perations for insta nc e he red uc edtransport costs by 30%.

He created the profit making and popular radio stations e.g. Coro FM andPwani FM.

With regard to the MW equipment loaned from Japan, he prepared adossier for cancellation of the Japan debt and handed it over to thePreside nt to p resent it during his offic ial visit to Japan.

Mr. Wawe ru outlined the prob lem s fac ing KBC as follow s;-

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Huge d eb ts ow ed to KPLC a nd Telkom Kenya . It wa s a c om mo n oc c urrenc efor power and telephone connections to be arbitrarily cut off thus affecting

the c orpora tion s op erations.

The KSh. 20 billion d eb t owed for the MW equipment which KBC was rem ittingto Trea sury in o rder to o ffset the loa n, heavily a ffec ted the c orpora tion s

financial status.

The b loa ted wo rkforce which led to a c omp lex sta ff struc ture. Retrenchingnon-performing staff was difficult (due to many factors such as lack of funds)

hence the management was forced to hire new staff to execute the duties

of the non-performing staff.

Lac k of fund ing from the g ove rnment notw ithstanding the fac t it wa s a Sta teCorporation.

Use o f outda ted tec hnolog y. The d ivergent bac kground s and interests of the boa rd me mb ers tha t were

som etimes in c onflic t w ith the c orpo ra tions interests.

He p rop osed the follow ing solutions to these prob lem s:-

KBC should commence the purchase and utilization of FM transmitters andmigrate from ana log ue to d ig ita l as soo n as possib le.

KBC management should comprise of qualified and competent personnel.The Boa rd should eq ually be c ompo sed of tec hnic al and qualified pe op le

such as mechanical engineers, broadcast engineers and media experts etc.

whose input wo uld b e of value to the c ompa ny.

2.4.3 A witness appearing before the joint Committee in camera informed the

Com mittee tha t:-

i) The Sta te Co rpora tion suffered from an identity c risis sinc e it previouslyenjoyed a monopoly as the sole broadcaster before the entrants of other

priva te m ed ia houses. Som e o f KBC s sta tions we re in p lac e fo r pub lic goo d

such as the Rendille FM which had a low listenership but aired programmes

on spec ific top ic s that were informa tive to the Rend ille.

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ii) KBC is crippled by financial challenges which are mainly caused by thego vernment s failure to fund the c orporation therefore lead ing to the inab ility

to ma nag e the c osts. Attemp ts by the m ana ge ment to ge t more funds were

unsuccessful.

iii) KBC had a bloated and frustrated workforce that was trained in themo nop olistic era. The personne l had a letha rg ic a ttitude sinc e the y had no

mo tiva tion to perform we ll.

iv)KBC did not have a single unique proposition to offer. Its previous uniqueprop osition o f be ing a monop oly, offering ve rnac ular rad io p rog ramm es and

having a wide reach in the rural and remote areas of the country had all

be en c hallenged and taken over by private media stations. Ac c ording to a

stud y d one by Synova te , Citizen had 88%; KTN ha d 55%; NTV ha d 51%; and

KBC had 45% geographical reach. With regards to the audience share,

Citizen ha d 52%; KTN ha d 14%; NTV had 12%; and KBC ha d 11%.

v) Lack of political will to solve the problems at KBC compounded thecorporations problems further. He further added that the current

model/structure of KBC was one of the major causes of its problems and not

the ma nag eme nt as wa s widely be lieved .

vi)He has never witnessed a situation where board members transactedbusiness with the c orpo ra tion.

vii)He has neve r rec eived any o ffic ia l co mp la int o f sexual harassme nt.viii)He agreed that the Medium Wave equipment procured from Japan was

indeed obsolete and the government should approach the Japanese

government for the cancellation of the loan. Further, the management

should procure new and modern eq uipm ents to improve e ffic ienc y.

ix) He informed the Committee that credit at KBC was authorised by themanagement and that the corporation had accumulated a huge l ist of

de bto rs be c ause it lac ked go od trac king systems and po or mana ge ment o f

clients payments.

x) He reco mmend ed an aud it of the huma n resourc e to strea mline the b loa tedworkforce.

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xi)The witness p rop osed tha t KBC ha d to see k for a unique prop osition to offe rthe market in order for it to survive. He recommended borrowing from the

British Broadcasting Corporation (BBC) model which is fully funded by

government and professionally managed. He further proposed that KBC

should focus more on its public service mandate as opposed to thec ommercia l venture.

2.5 EVIDENCE BY THE MINISTER FOR FINANCE

The Ministe r for Financ e, Hon. Rob inson Githa e, EGH, MP appea red befo re the

joint Committee on Tue sday March 20, 2012. He was ac c ompanied by the

Investments sec reta ry Ms. Esther Koimett, CBS. The Financ e Ministe r informed the

Com mittee tha t:-

i)

The loan from Japan for the Me d ium Wave (MW) eq uipment wa s aGovernment guaranteed loan. He stated that the Government has been

paying the loan on behalf of KBC but it has been debiting the corporation

through the yea rs.

ii) Initially when the equipment was procured (in June 28th 1989), it wasva lued a

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Parliamentary Report On KBC

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