Nairobi News


Media ejected from Sh1.7 billion City Hall AAR medical scheme scandal probe

By Collins Omulo September 16th, 2019 3 min read

The controversial Sh1.7 billion AAR Kenya medical insurance scheme for City Hall staff has reared its ugly head again with media being thrown out of a watchdog committee sitting probing the scandal.

Journalists were asked to leave the Nairobi County Assembly Public Accounts Committee (PAC) with members of the committee divided on the exclusion.

This was after Nairobi acting County Secretary Leboo Morintat called for the media to be excluded from the meeting.

The watchdog committee is grilling more than seven members of the county executive regarding their role over the contentious Sh1.7 billion county staff medical insurance.

Nairobi County government is on the spot for paying more than Sh652 million in excess of the medical scheme’s contract term of Sh1.07 billion.

According to the Auditor General’s report for the financial year ending June 30, 2018, City Hall made a total payment of Sh1.73 billion to AAR Insurance Kenya Limited although the contract sum was Sh1.07 billion.

“Although the total payment made so far to AAR Insurance Kenya Limited is Sh1, 725, 488, 939, no explanation has been given for paying Sh652, 786, 602 in excess of the contract sum of Sh1, 072, 702, 337,” read the report in part.

In addition, a comparison of the annual contract sum shows unexplained growth in value of the insurance cover even though there was decrease in number of staff by 402 during the year under review.

In financial year ending June 30, 2016, the number of employees were 13, 348 with the contract value of Sh346.3 million, the same for 2016/2017 which had 13, 097 employees.

In the financial year ending June 20, 2018, the contract sum for the medical insurance scheme shot up exponentially to Sh1.1 billion although the number of the employees had reduced to 12, 695. Currently there are 12, 499 employees at the county.

This is not the first that the officer is doing the same. In July, the acting County Secretary also asked for the media to leave the committee sitting before he could answer any queries regarding the controversial AAR medical cover. The request was also granted at the time.

Most members of the committee, five out of six, protested the request but despite their opposition, the chair of the committee Wilfred Odalo granted Mr Morintat his wish. Only Kilimani MCA Moses Ogeto supported the move.

Minority whip Peter Imwatok and Karen MCA David Mberia said it was frivolous for the executive to call for exclusion of the media with no justifiable reasons why he wanted to speak in camera.

“Throwing the media out will paint the county in bad light as this is not the first time this officer has done this. The public will not forgive this committee if this will be the trend,” said Mr Imwatok.

“There is nothing to hide as we are discussing matters of public concern. This is the second time this officer is making the request. Last time it was also granted,” said Mr Mberia.

Sarang’ombe MCA Lawrence Otieno and Ngei MCA Redson Otieno agreed with Mr Imwatok saying: “The media has to stay because the public wants to know how their money was spent. Why is the member always fearful and constantly wants the media excluded when he appears before us?”

The exclusion of the media came after intense lobbying to have the committee cancel the sitting failed. The committee which was to start at 10.30am was suspended for several hours only to start at 1.10 pm as the chair was under extreme pressure to ensure that the committee does not hold the sitting.

Interestingly, only ODM-allied members of the committee present at the meeting as their Jubilee counterparts who had come for the sitting soon left.

One of the Jubilee MCAs told the Nation that they were threatened by their party leadership that they will be de-whipped if they attended the sitting.

“We have been told in no uncertain terms that we should not attend the session and those who will, will be de-whipped from committees,” said the MCA who did not want to be identified for fear of victimisation.

The committee has lately been under pressure for unearthing malpractices at the executive and their hard hitting reports with members being accused of colluding with the media to expose Governor Mike Sonko’s administration.

Mr Leboo has been cited by the committee for being a ‘malicious’ witness for repeatedly failing to appear before it on various sittings.

This prompted the committee to invite him, together with six other officers, for the last time yesterday or they risk being arrested.

The AAR cover has come under stern scrutiny since the deal was signed with former Governor Evans Kidero’s administration in 2015 where the firm has been earning between Sh1.06 billion and Sh1.3 billion every year.

The firm’s contract with the county government was to end on June 30, 2017, but Governor Sonko’s administration extended the deal by three months to allow time for fresh procurement. This led to outcry from a section of the MCAs who filed a case in court.

In January this year, Kenya County Government Workers Union raised alarm over lack of a medical cover following revelations that county staff had stopped receiving the cover from December 31, 2018.