NHIF on spot over misuse of funds

NHIF Building in Nairobi's Upperhill Area. FILE PHOTO | NMG
NHIF Building in Nairobi's Upperhill Area. FILE PHOTO | NMG 

The National Hospital Fund is on the spot for failing to explain how the cost of construction of its city’s multi- storey car park was escalated by 337 percent over and above its original cost.

According to the report of auditor general Mr Edward Ouko for the year ending June 30, 2016, Sh0.9 billion was budgeted for the entire project in May 2002 and the contract awarded to a local construction firm.

However, it was until 2008 that the project initially scheduled for completion in August 2003 was completed.

By the time of its completion, Sh3.4 billion had been spent. As if this was not enough, a further Sh626.6 million and Sh4.7 million was incurred in the financials years 2009/10 and 2010/11 respectively on the park.

The additional expenditures increased the total sum to Sh4 billion.

The report tabled in the National Assembly last week by leader of majority Mr Aden Duale, further indicate that immediately the contract was awarded in 2002, the contract sum was revised upwards to Sh1.2 billion representing approximately 30 percent of the original sum of Sh0.9 billion.

“Although the issue has been discussed by the Public Investment Committee, no action appears to have been taken on the PIC recommendations as per the 19th report,” the auditor general’s report states.

The National Assembly watchdog committee, however, recommended that the Ethics and anti- Corruption Commission institute investigations on the project with a view to preferring charges against those found culpable.  

The report was adopted in 2015 but so far no action has been taken against those involved by the responsible government agencies.

The auditor general has also raised questions on the NHIF 10 hectares land in Karen valued at Sh298.6 million.

The report notes that the ownership of the land is in dispute and the matter is in court. According to the auditor general, although the issue was discussed by the PIC, no action was taken on the committee’s recommendations in its 19th report that the National Lands Commission conducts further investigations on the matter within six months.

Despite Sh1.4 billion being set aside for drawings and designs for the proposed resources center, construction is yet to start since the land was acquired 14 years ago.

“As noted in the previous year, the management has not commenced because of lack of approval from the parent ministry. It has not been possible to ascertain the ownership status of the parcel of the land in dispute,” the report noted.