Split recommended for Utalii Hotel, College

May 14, 2009

, NAIROBI, Kenya, May 14 – A taskforce committee looking into the status of Utalii College on Wednesday recommended that it be de-linked from Utalii Hotel and a complete overhaul of its financial system and top management be done within six months.

Tourism Minister Najib Balala set up a new management team to be headed by the PS Eunice Mima and the new college principal Dr Kenneth Ombongi to facilitate the recovery of outstanding debts at the institution amounting to about Sh158 million.

"These cause a tremendous strain on infrastructure and financial resources," stated the report.

“The Hotel is eating into the resources of the college and I want to appoint a team from within my office headed by acting PS Eunice Mima, Tourism Director and his deputy, and the Ministry’s Economist to look at the process in the next couple of weeks… how we are going to de-link the college and then as per the recommendation we appoint an independent body to run the hotel,” he said.

The institution lacks an internal audit department and the procurement system is full of loopholes, the report intimated. The money generated in the overlapping functions of the college and hotel also do not show the correct profit and loss positions.

Due to ineffective accounting systems, Utalii has a Sh158 million debt, of which Sh52 million is owed by the Kenya Revenue Authority in VAT refunds.

Looking at stiff competition from similar institutions, the minister directed that Utalii adapt to the changing times and admit regular students on a non-residential basis.

He said he was pushing for the re-categorising all tourism promotion institutions in order to attract qualified professionals from the private sector.

Mr Balala added that his ministry has appointed the Lausanne Hotel School to carry out an academic audit on the programmes offered at the institution with a view of improving them to international standards.

The report explains how Utalii has sunk from a centre of excellence in hospitality training since inception in 1975 to a shell that cannot compete with similar regional institutions.

The report by the taskforce calls for the sacking of all 836 employees, including the top management, and thorough restructuring of operations.

The report states that it makes little business sense for the 50-room hotel to have 129 employees, while the college has 707 students.


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