Senate wants Lenku to turn water firm to profitability
By Rawlings, October 9, 2023
A Senate oversight committee has ordered Kajiado Governor Joseph ole Lenku to turn around operations of a debt-ridden Oloolaiser Water and Sewerage Company (OLWASCO) within 60 days. The lawmakers described Olwasco, which supplies water in Ngong, Rongai, Kiserian and the environs, as technically insolvent and is edging towards bankruptcy.
The Senate County Public Investments and Special Funds committee yesterday questioned how the company is operating on a negative working capital of Sh120.5million even as it struggles with liabilities of Sh196.6million.
The Auditor General Nancy Gathungu’s report for the financial year ended June 30, 2021 revealed that the company registered a loss of Sh97.7 million in the financial year ended June 2019, Sh22.8 million in the following fiscal year and Sh25.6 million in the financial year ended June 2021.
“The company is experiencing financial difficulties impacting on its sustainability and is edging towards bankruptcy. The negative trend casts significant doubt on the future existence of the company,” reads part of the auditor’s report.
In addition, the water utility firm is also grappling with an operating loss of over Sh120 million having been on a loss-making trend since 2018, owing to huge unpaid water bills by consumers in the satellite towns.
The report further revealed the firm is also struggling with high non-revenue water (NRW) of 38 percent against a threshold of 25 percent allowed by the Water Services Regulatory Board (WASREB) regulations. According to the audit report, four out of every 10 litres of water produced by the company was not paid for during the year under review.