Audit reveals pyrethrum firm paid Sh20m for no work done

Tuesday August 06 2019

The main entrance of Pyrethrum Processing Company of Kenya Ltd in Nakuru on February 9, 2018. PHOTO| FILE | NATION MEDIA GROUP


The cash-strapped Pyrethrum Processing Company of Kenya (PPCK) is on the spot for hiring casuals who were paid Sh20 million for no work done, a report by the Auditor-General Edward Ouko has revealed.

The report has also revealed how the Nakuru-based company undervalued its assets and undeclared rent from 200 properties.


The report says that the company, which has been dogged by corruption and mismanagement of resources in the past decade, failed to remit statutory deductions from workers despite the money being factored in the budget.

“The company failed to remit millions of shillings of workers' union dues, pension scheme, bank and loan repayments despite money being set aside in the budget " reads the report.

Pyrethrum Superannuation Pension scheme is owed in excess of Sh2 billion.


Most of the workers have retired while some of them have died without enjoying their pension.


Mr Ouko, while exposing the rot at the state-funded corporation for the period 2017-2018, said that PPCK failed to declare rent it received from tenants.

PPCK has properties mostly houses and land worth in excess of Sh4 billion in almost all the 18 pyrethrum growing counties. The houses have been leased out to individuals and companies.

The audit report further revealed that PPCK under declared rentable properties leased out to third parties including two state entities- Commodities Fund and Pest Control Board.

According to records at PPCK, the company collected Sh15 million in rent while a review of the rental properties by the audit team indicates the company could be collecting up to Sh29.8 million.

“The rent collectable and collected is therefore not only under- declared but part of it is also not accounted for," the report says.

Interestingly, even with financial difficulties, PPCK undertook a re-evaluation of its assets at a cost of Sh14.5 million. The firm is said to have left out a number of properties including pieces of land and motor vehicles without any justification.


This has fuelled speculations that the properties could have been grabbed.

The report indicates that from a pool of 58 motor vehicles and heavy machinery, the company owns only six vehicles which were revalued.

At least eight vehicles valued at Sh11.5 million were impounded and auctioned to offset outstanding payments to a service provider who had carried out some work at PPCK during 2013- 2014 financial year.

"Out of the existing 50 vehicles, logbooks for 10 vehicles were not provided for audit. Consequently, their ownership remains doubtful," said the report.