- The State Corporations Advisory Committee (SCAC) told Parliament that it advised Mr Kenyatta to sack YEDF board almost a year ago.
- The Inspectorate of State Corporations (ISC) had similarly recommended the sacking of the entire board, but todate the team is still in office.
President Uhuru Kenyatta’s name has once again been dragged into the Youth Enterprise Development Fund (YEDF) troubles after a second State agency said it had asked him to sack the entire board.
The State Corporations Advisory Committee (SCAC) told Parliament that it advised Mr Kenyatta almost a year ago.
This was revealed during investigations into the alleged loss of Sh180 million belonging to the fund through a suspect IT contract offered to Quorandum Limited.
The Inspectorate of State Corporations (ISC) had similarly recommended the sacking of the entire board, but todate the team is still in office, turning the focus on Mr Kenyatta.
Ms Jane Mugambi, the former SCAC chief executive officer said the YEDF board chaired by Bruce Odhiambo disregarded Treasury circulars and Section 12 of the 2007 order establishing the fund when it invested surplus money in commercial banks instead of lending it to the youth.
Despite the YEDF board being inducted on the Mwongozo code of conduct for State corporations, the board acted in total disregard of the laid down procedures, Ms Mugambi said.
“We have given a list of board members of the YEDF whom we inducted on Mwongozo code. What happened at YEDF is a disappointment on our part.”
“We didn’t expect surplus funds in the YEDF because they were to be lent to the youth. To have Sh400 million invested in a bank is unfair. The board should be held collectively responsible for what has happened in the YEDF. They had a fiduciary duty to ensure the youth money is used for the intended purpose,” Ms Mugambi told the Public Investment Committee (PIC) Wednesday.
The ex-SCAC official said that despite the Principal Secretaries (PS)Treasury and Public Service, Youth and Sports being represented in the YEDF, the board went ahead to invest the money without seeking the Treasury’s approval.
PS Treasury Kamau Thugge (Finance) and his Devolution counterpart Peter Mangiti were represented in the board by Samuel Macharia and Isaac Kamande respectively.
The PIC is investigating how Sh180 million was transferred in two tranches of Sh115 million and Sh65 million to Quorandum, 10 days after Mr Odhiambo appointed Catherine Namuye, the suspended acting chief executive, as the sole signatory to the fund’s account.
Ms Namuye allegedly contracted Quorandum to design a computer management software for the fund before making the payments.
“SCAC has not slept on the job. We empowered the board to exercise its duties. The whole board in this matter is collectively responsible,” said Ms Mugambi.
She added that the board did not bother to recruit a substantive chief executive from 2010 when the position fell vacant.
Last week, Ms Namuye termed the Sh180 million loss as a board project saying the money was transferred on pressure from an unnamed director.
Ms Mugambi also revealed that the YEDF has been operating without a company secretary. She termed Mr Odhiambo’s decision to appoint Ms Namuye as the sole bank signatory and the sacking of the finance officer Benedict Atavachi illegal.
Mr Odhiambo usurped the powers of the management and the board in the sacking of the finance officer and appointment of Ms Namuye as YEDF’s sole bank signatory, she said.
PIC chair Adan Keynan took Ms Mugambi to task to explain what SCAC did when the loss at YEDF came to light almost a year ago.
“We have advised the president to merge almost four funds, including the Youth and Women Enterprise Fund into the Biashara Kenya to have a pool of about Sh20 billion that will have major impact on the target groups,” Ms Mugambi said.