{UAH} Highest paid Kenyan CEO who caused a stir with Sh130,000 in the 1980s
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Highest paid Kenyan CEO who caused a stir with Sh130,000 in the 1980s
SUNDAY JANUARY 15 2017
Henry Kinyua, former Kenya Planters' Co-operative Union CEO whose Sh130,000 pay became the subject of a parliamentary debate. PHOTO | FILE | NATION MEDIA GROUP
By BENSON WAMBUGU
When the obituary of Henry Kinyua appeared in the Daily Nation on Thursday, many did not probably notice it marked the end of an era for one of the most influential figures in the history of Kenya's coffee sector.
At some point during the prime of his lucrative career as the powerful managing director of the Kenya Planters' Co-operative Union (KPCU) in the 1980s, Mr Kinyua was considered the highest paid Kenyan.
So serious was the matter of his pay that he was once the subject of a Parliamentary debate in March 1987. Some MPs had, in an earlier sitting, complained that Mr Kinyua was among those who had defied government orders by holding multiple positions and cited his roles at KPCU, Coffee Board of Kenya, Nairobi City Commission, Kenyatta University Council and the Tana River Development Authority.
In a statement to the House, Agriculture minister William Odongo Omamo said a decision had been made for Mr Kinyua to concentrate on KPCU to warrant the "fat salary" he was getting.
"The government feels that Mr Kinyua, who is earning Sh130,000 per month, plus three cars and other benefits, should serve full time in the Kenya Planters' Co-operative Union," he said.
Butere MP Martin Shikuku, rising on a point of order, noted that apart from the salary there were also generous allowances and wondered why only a few people were "enjoying the Uhuru of this country alone" instead of the wealth being spread.
Today, KPCU is a pale shadow of its former self — a reflection of the struggling coffee sector — while some of the highest paid CEOs earn upwards of Sh5 million and are mostly in banking, telecommunications and technology.
Ironically, on his deathbed, Mr Kinyua was still battling a long-running civil suit for a Sh47 million pension payout, 28 years after he was pushed out from the influential position.
UNDER RECEIVERSHIP
Going by the proceedings which this writer covered in court, it was apparent he would have enjoyed the fruits of his litigation until hell broke loose when KPCU was placed under receivership over a debt of Sh700 million owed to the Kenya Commercial Bank.
As the main witness in his own case, Mr Kinyua had to be stepped down from the witness box during the hearing after it emerged there were technicalities that required resolution before the suit could proceed.
"Wait a minute! Who should take responsibility if Mr Kinyua succeeds in his claim against KPCU, now under receivership?" posed judge Muga Apondi. From then on, the case appeared to have withered.
Mr Kinyua had sued KPCU for breach of a contractual agreement that entitled him to a pension after retirement until he died. He accused KPCU of purporting to revoke the agreement through a letter dated September 1988.
But as fate would have it, he passed on before the court could determine whether or not he was entitled to his terminal dues. Whatever is left in the suit will now become part of his succession.
The suit documents and his affidavits also partially lifted the veil on what he was supposedly earning in salary and allowances.
In a sworn statement, he said that when he opted to retire from KPCU in 1988, his monthly salary was Sh395,522, and in the contract, he was entitled to Sh254,336 from July 1988 to April 20, 1996 after he attained the age of 60. And after his 60th birthday, he said he was entitled to Sh175,231 per month until his last breath.
In 1983, there was sustained pressure for Mr Kinyua to be removed from his top post on the grounds that KPCU was allegedly involved in various irregularities.
He reacted sharply to the alleged pressure to quit and was quoted in a local daily as saying: "Why should I quit. I have done nothing wrong. I was appointed by the KPCU board of directors and the board is happy with my performance."
Asked to comment on reports that he was receiving an alarmingly high salary, Mr Kinyua hit back saying he did no pay himself a salary and whatever he earned was what KPCU thought was justified.
"Nobody pays himself a salary. I get my pay package from the union, an organisation I have associated with since I left Makerere University in 1962.
"I started from the bottom in the coffee industry and worked my way up through hard work, persistence and devotion," stated Mr Kinyua.
By then, a report from an inquiry committee commissioned to conduct a forensic audit at KPCU had recommended that Mr Kinyua and other senior executives were being grossly overpaid and should be sacked for misuse of office.
KPCU ADVANCED LOANS
Mr Kinyua was in 1983 said to be earning a monthly salary and allowances amounting to Sh98,000. The report also alleged that KPCU had advanced loans to the tune of Sh28 million without or with insufficient security.
KPCU was in 1980s the biggest employer in agriculture with an estimated 2,000 workers.
The man who served the co-operative union in the regimes of President Jomo Kenyatta and President Daniel Moi has seen it all from the rosy days when coffee was the Kenyan "gold" to the steady decent into oblivion of one the most treasured crops in the country.
Mr Kenyatta had given Mr Kinyua unrestricted freedom to run the coffee sector that enabled KPCU to grow its stature, earning accolades in the international arena.
However, it was during his successor, President Moi's tenure in the 1980s that the fortunes of the union started declining. This went on until the sector was driven to an early grave, never to recover again.
When Moi ordered a probe into KPCU in 1990, the investigation exposed underhand dealings between politicians and managers after Mr Kinyua had been pushed out. The report was later shelved after it mentioned close political and business allies.
The Makerere University alumni, who graduated in 1962, landed his first employment at the KPCU in 1964 as a junior officer and rose through the ranks to become the MD of the then premier farmers' union.
Mr Kinyua was the long-serving KPCU CEO until his controversial retirement in 1988. He died early this week.
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