Parliament has made the right decision to stop the takeover of Jomo Kenyatta International Airport by the loss-making Kenya Airways. The whole deal is shrouded in mystery and sounds suspect.
Recent revelations have just confirmed our fears. The deal is being fronted and pushed by individuals or groups outside the orbit of the airport authority, raising question about their motive. This week, Kenya Airports Authority Managing Director Jonny Andersen categorically told Parliament’s Public Investment Committee that the organisation was never involved in the transaction. Neither did it originate the idea nor was it ever consulted.
Rather, the authority was railroaded into the transaction. To be sure, Mr Anderson stated the authority was instructed by Principal secretaries Paul Maringa and Esther Koimett to enter into the discussion with Kenya Airways with the rider that the decision had been made by higher authorities. Who is this higher authority? Neither was KAA team given any written communication from the Cabinet to validate the directive.
This is a stinker. First, KAA is a public entity with an independent board. If a decision is to be made on its ownership and operation, there must be a proper process that involves even parliamentary approval. Asking KAA to hand over management of the airport to another entity, in this case Kenya Airways, is a major decision that cannot be made casually. Airports are strategic assets and must be jealously guarded. Thus, the Cabinet cannot purportedly issue directive on their takeover without following the correct procedure.
Second, even if perchance the decision was to be made, Kenya Airways does not have the capacity and resources to manage airports. Kenya Airways has perennially been making losses. It went into a misguided expansion plan that saw it procure aircraft it did not need and entered into routes that did not make economic sense. The fuel pricing model it adopted as well as ticket costing were poorly crafted and the result has been high operational costs and reduced passenger uptake. Simply put, it is a struggling entity and hence cannot be entrusted with an entirely new business to manage. Not when KAA has not complained or expressed desire to be assisted.
The point is that this is a dud deal that should be stopped and, importantly, the Auditor-General and other agencies must investigate the goings-on behind the plan that is bound to cost taxpayers billions.