Controversy rocks fuel station owned by Meru county govt

Located on Mwendantu Road in Meru town, is a petrol station owned by the Meru County government.

The county’s investment arm — Meru County Investment and Development Corporation (MCIDC) — owns and runs the station that has now generated heat in the county assembly. 

The corporation, one of the first parastatals by a devolved unit, was established under an Act of the Meru assembly in 2014 with a mandate to promote, attract and support investments in the Mt Kenya county.

REDUCE FUEL EXPENSES

The station, which operates under the name Meru County Oils Ltd, started operations in May 2017.

Trouble started rocking the oil seller after the auditor-general faulted the corporation for not paying Sh100,000 in share capital by January 2019.

The management, headed by board chairperson Felicity Biriri and acting Managing Director Samwel Odhiambo, cited lack of funds.

The station was set up by former Governor Peter Munya with the intention of containing wastage of public funds through fuel expenses.

“We want to seal loopholes which government drivers use to waste fuel,” Mr Munya, now Trade Cabinet secretary, said then.

“We will outsource the fuel from the corporation enabling it to generate income for the government. The project is well thought out and will create jobs.”

Two years later, the service station is largely idle, with a few PSV and private vehicles fuelling there as some of the county government vehicles fuel at private stations.

It is not clear why some county vehicles stopped fuelling at Meru County Oils. A promise by the management to explain the matter to the Nation had not been honoured by publication time.

According to Meru County Oils Ltd financial statements for 14 months ending in June 2018, the service station made a loss of close to Sh2 million, causing the Meru assembly to call for its closing.

Consequently, Meru MCAs want it closed down as soon as possible.

They have called for the immediate leasing of the entity to private firms to “save the government from incurring losses on public funds”.

Speaking during debate on a report of the Public Accounts Committee on the station’s financial status, some of the MCAs argued that the parastatal should be closed immediately and leased to private operators.

CONFLICTING INTERESTS

“It is impossible for government to do business. The petrol station should be leased out immediately,” nominated MCA Secondina Kanini said.

Athiru Ruujine Ward Rep Japhet Kirimi said the fuel station should be abandoned since it was making losses.

“If it is not leased out, it should be closed,” he said.

The lawmakers also called for investigations into the activities of the MCIDC, arguing that the parastatal was moribund.

Besides the fuel business, the corporation also owns the new Meru County government offices, a commercial building in Meru town and the Meru coffee marketing agency as well as a 12.5 percent stake in the Meru County coffee mill.

But Kiguchwa Ward Rep Linus Athinya accused the MCIDC board of failing in its mandate of improving investments in the county.

“MIDC is now a dead entity,” he said.

NO PROFIT

“It is run by qualified board members who have turned around other institutions, why can’t they transform the county?”

The leaders observed that if the entire county government fleet fuelled at the county petrol station, it would make a profit.

According to the 2018/2019 annual budget implementation report by the controller of budget, Meru County spent Sh54.6 million on fuel, oils and lubricants.

In January this year, the corporation published a tender seeking to lease out the filling station but only one firm applied.