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Members of Parliament were yesterday shocked to hear how an official of the National Land Commission (NLC) ordered the Kenya Railways Corporation Managing Director Philip Mainga to reverse a payment of Sh1.6 billion to a land owner claiming it was erroneously entered.

Mainga said he received a letter from NLC Director Valuation and Taxation Salome Munubi directing him to cancel the payment as it was erroneously included in the list.

The MD who appeared before the Public Investment Committee on Commerce and Energy said in view of the directive of the commission, he could not confirm whether the money was paid to the rightful beneficiary.

“According to the letter, the commission asked me to cancel the payment, I cannot therefore tell what happened thereafter,” Mainga said.

Asked who was responsible for the mess, Mainga said, “KR does not engage in valuation and compensation, we provide the money and pay out to the beneficiaries identified by the commission.”

He said that he once inquired what the role of the KRC was only to be told that he was only a conveyor belt.

The two entities had been summoned by the committee to respond to queries raised by Auditor General Nancy Gathungu who in her report raised queries on the loss of billions of shillings in the compensation of land owners who lost land to the Standard Gauge Railway (SGR).

Mainga and NLC Chief Executive Kabale Tache Arero were hard pressed to explain the loss of Sh 1 billion which could not be accounted for by the auditor.

“Who played what role in the payment of the compensation money since you have been passing blame every time you appear here?” posed committee chairperson David Pkosing.

Arero, who defended herself saying she was not in office when the payments were made, sought for more time to put the papers in order.

Pkosing had directed that the commission provide the master list of all the beneficiaries of Sh 12 billion paid out to the land owners.

“Mr. Chairman, I plead for more time to prepare the documents you have asked for. This is a tedious exercise which will require time,” Arero pleaded.

According to the auditor, the documents availed by the commission covered for Sh 11 billion but there was nothing to show for the remaining Sh 1 billion.

The auditor says in the report that no Identification cards, PIN nor title deeds were provided to support the payment of Sh 1 billion. The auditor further said in the report that the bulk of the money paid out to owners of parcels whose value was highly inflated, or for false claims.

The report shows that in most cases NLC did not conduct due diligence before making payments.
In other instances, it over-compensated some land owners as it also made double payments or failed to carry out the exercise in a transparent and lawful manner.

In some cases, compensation was paid for public land because of failure by the commission to conduct a search at the Lands registry before making payments.

Report raises concerns that NLC, which was then headed by Muhammed Swazuri, does not maintain a database or register of all public land acquired contrary to Sections 8 (a) of the Land Act, 2012.

Some valuation reports availed by NLC management were not dated, not signed and could not therefore be relied upon to give assurance on lawfulness and effectiveness in utilisation of public funds,” the report.
On over compensation, double compensation in different areas or false claims for compensation, the auditor established that valuation reports amounting to the Sh7.7 billion projects were not dated, not signed or not availed at all thereby raising doubts on their reliability when effecting payments.

The report shows that there was no evidence to indicate that NLC had conducted an official search at the Lands Registry to confirm whether parcels of land worth Sh9.6 billion had been lawfully acquired and were not public land.

The Auditor saaid NLC should ensure that before effecting payments, there exists reliable valuation compensation schedules that are dated and signed.

The report further raises concerns over the commission’s move to approve payment by KRC of Sh21.8 million for the acquisition of land of 12. 98 hectares for the construction of a station at Sultan Hamud, which was later relocated to Emali.

“Under the circumstances, the special audit could not provide assurance that NLC had confirmed that the aforementioned parcels were lawfully acquired and were not public land as defined by law.”
Audit also raises concerns that payments amounting to Sh221.4million were paid to a company, which had not been listed as property owners.