MCAs seek probe into City Hall, AAR cover fraud claims

Nairobi County Assembly

Ward representatives are pictured during a session of the Nairobi County Assembly on December 3, 2020. PHOTO | NMG

Nairobi ward representatives are calling on the Ethics and Anti-Corruption Commission to investigate the Sh1.7 billion AAR Insurance Kenya medical cover contract for City Hall staff, claiming fraud.

Led by Waithaka MCA Antony Kiragu, they claim some county officials have been making money from the AAR-City Hall deal with payments being withheld and redirected to well-connected individuals to do business with the funds.

“I will be personally writing to Ethics and Anti-Corruption Commission and Directorate of Criminal Investigations to probe the deal,” said Mr Kiragu adding that 29 county workers had died after trying without success to access the medical cover.

According to the MCA, the county has lost millions of shillings in the fraudulent scheme.

“The reason why the payments are being done in phases is because people want to do business with AAR money. The officers want kickbacks from AAR,” he said.

The new development comes as Nairobi County Assembly Majority Leader Abdi Guyo plans to bring a motion to form an ad-hoc committee to look into the AAR-City hall medical scheme.

He said the committee will establish if any individuals have benefited from the Sh1.7 billion paid to AAR by City Hall every year.

Matopeni MCA said the committee’s mandate will be to investigate how AAR was awarded the contract, what service it is providing and whether there is value for money.

The AAR-City Hall deal, which began in 2015, has experienced perennial turbulence with workers often caught in the middle of the push and pull between the two parties.

Last month, AAR pulled the plug on the deal after the county government failed to remit outstanding premiums.

However, the scheme was restored early this month when City Hall paid Sh270.1 million to AAR promising to clear the outstanding arrears by April 23, 2021.

Due to the wrangles, plans by the assembly and the Nairobi Metropolitan Services (NMS) are already underway to shift the medical cover to National Hospital Insurance Fund (NHIF).

AAR’s latest three-year contract with City Hall inked in 2017 lapses on June 30, 2021 at the end of the current financial year.