Kisumu Senator Anyang’ Nyong’o who moved the motion called for the overhaul of the current business plan being used by the airline saying it had failed to turn the company around citing a consistent drop in profits.
“The national carrier has been experiencing tremendous delays and cancellation of flights, each delay has led to grave losses worsening the debt burden of the corporation and concerned that the situation if left unchecked may lead to the collapse of the company, the Senate resolves to form a select committee,” said Nyong’o.
The committee will look into the leasing and buying arrangement of aircraft since 1996, the role of offshore companies in the investment affairs of the airline, the identity of the shareholders of the offshore companies and their level of engagement with the KQ management.
It will also take into account the employment policy and practices of personnel including engineers, pilots, cabin crew and ground personnel, the reason for delayed and cancelled flights and the losses incurred in the process and any other issues that could shed light on the financial and management crisis facing the airline.
The 11 member committee which is expected to report within three months comprises various Senators among them Anyang’ Nyong’o, Mutahi Kagwe, Boni Khalwale, Agnes Zani, Naisula Lesuuda and Peter Mositet among others.
The move comes as the cash strapped local airline entered into a Sale and Lease Back transaction for the three B787-8 Dreamliners to be delivered this year with AWAS Aviation Trading Limited, a leasing company based in Ireland.
The airline recorded an after tax loss of Sh10.4 billion in the half year ending September 2014 which the carrier attributes to the challenging business environment in the period.
Migori Senator Wilfred Machage welcomed the move to form the committee saying it was timely as, “the so-called pride of Africa had become the plight of Africa”.
The airline had blamed its woes on the insecurity situation within the region which had resulted in fewer travelers, the travel advisories being imposed on the country due to insecurity and the ebola epidemic which had ravaged the West African region.