By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
Newsunplug KenyaNewsunplug KenyaNewsunplug Kenya
  • News
    • Metro
    • Politics
    • Business
  • Entertainment
  • Lifestyle
  • Sports
  • Tech
  • Spotify
Reading: Officials from NHIF took Sh21b in “debts.”
Share
Notification Show More
Font ResizerAa
Newsunplug KenyaNewsunplug Kenya
Font ResizerAa
  • News
  • Entertainment
  • Lifestyle
  • Sports
  • Tech
  • Spotify
  • News
    • Metro
    • Politics
    • Business
  • Entertainment
  • Lifestyle
  • Sports
  • Tech
  • Spotify
Have an existing account? Sign In
Follow US
© 2022 Foxiz News Network. Ruby Design Company. All Rights Reserved.
Newsunplug Kenya > Blog > News > Officials from NHIF took Sh21b in “debts.”
News

Officials from NHIF took Sh21b in “debts.”

Ivy Irungu
Last updated: September 12, 2024 5:39 am
Ivy Irungu
10 months ago
Share
SHARE

South African President Cyril Ramaphosa’s office has announced that he will sign a controversial education bill into law, which has sparked the first significant discord in his unity government. The Democratic Alliance (DA), the second-largest party in the coalition, warned that this move could jeopardize their coalition agreement.

In response to the DA’s statement, Ramaphosa’s spokesperson urged restraint, emphasizing that a legislative dispute should not threaten the stability of the government. The DA had formed a coalition with Ramaphosa’s African National Congress (ANC) and other smaller parties after the ANC lost its parliamentary majority in the May elections, despite significant ideological differences.

DA leader John Steenhuisen criticized the decision, stating that passing the bill would breach the agreements that underpin the government of national unity (GNU). “The DA regards this issue in the most serious light, and I will convey to the President the destructive implications it holds for the future of the GNU,” Steenhuisen said.

He did not specify the exact consequences but will discuss the DA’s role in the unity government in a press conference on Thursday in Cape Town.

Presidential spokesperson Vincent Magwenya acknowledged that disagreements over legislation are expected and announced that the government parties would meet to discuss a dispute resolution mechanism. “There shouldn’t be any concern that each time there’s a dispute, the entire governance framework of this country will be under threat,” Magwenya told reporters. “The president is not concerned about the GNU collapsing.”

READ MORE  CS Kabogo: My appointment had nothing to do with Ruto, Uhuru meeting

The bill in question proposes several amendments to South Africa’s basic education laws. The most contentious clause would enhance government oversight over schools’ language and admission policies, addressing concerns about racial integration. The ANC argues that the legislation is necessary to prevent exclusion of children based on language, which has been used as a proxy for race.

A parliamentary committee has uncovered a major scandal involving National Health Insurance Fund (NHIF) officials, who allegedly embezzled a staggering Sh21 billion within a year by fabricating non-existent debts.

The scheme involved opening a “creative account” during the financial year ending June 2022, creating liability accounts from which the funds were withdrawn under the pretense of settling these fictitious debts.

The funds were siphoned from various sources: Sh2.9 billion from civil servants’ schemes, Sh4.1 billion from the Eduafya Scheme, Sh525.3 million from county schemes, Sh780.7 million from parastatals, Sh191 million from retirees’ schemes, and Sh2.3 billion from Linda Mama, according to the Public Petitions Committee of the National Assembly.

Committee member Ernest Kagesi described the situation as dire: “The mandarins opened liability accounts knowing full well they had no money to pay. They went on to spend money held on behalf of other state agencies to pay off these fake debts without informing the members. This is serious. Sh21 billion was stolen by paying off non-existing liabilities. We will get to the bottom of it.”

READ MORE  Nineteen people are killed in a shootout in Sinaloa State, Mexico, and a local cartel commander is detained.

The petition, filed by Bernard Muchere, a Fraud Risk Management consultant, claims that NHIF was defrauded through fictitious Incurred But Not Reported (IBNR) claims created for the financial year ending June 30, 2022. Muchere argues that there is no evidence of a sinking fund bank account where the retained earnings should have been deposited, implying that these earnings were merely book entries.

“It means that IBNR claims reserves were created from book entries and no actual money was set aside,” Muchere said. He added that the fraudulent handling of unbudgeted IBNR claims of approximately Sh21 billion, using members’ scheme contributions, led to a severe shortfall in NHIF funds. This shortfall caused significant financial difficulties, severely impacting patient benefits and leaving many Kenyans without adequate health coverage.

According to the petitioner, an Incurred but Not Reported (IBNR) reserve account is used in the insurance industry to provision for claims and events that have occurred but have not yet been reported to the insurance company.

“IBNR is a common practice, especially in regions prone to natural disasters, such as along the eastern Gulf Coast of the United States. After a storm, for instance, an actuary estimates the potential damage and the anticipated claims. Based on this assessment, money is then set aside in a reserve to cover these claims,” the petitioner explains.

READ MORE  Australian police nab man over 17 million scam texts

“This is why during the period when NHIF members were being told that their cards were invalid, the funds had already been siphoned off and the coffers were empty,” Muchere said.

When asked by Kuria East MP Maisori Marwa why he did not report the issue to investigative agencies like the DCI or the Ethics and Anti-Corruption Commission (EACC), considering the scale of the scandal, Muchere explained that he chose to go through Parliament due to past experiences with handling similar scandals.

The petitioner states that he conducted a fraud examination of NHIF’s financial statements for the year in question, which revealed the extent of the financial mismanagement.

Governor Nyong’o, his deputy lead protests in Kisumu
Murder weapon in Kasipul MP Charles Were’s killing recovered, police confirm
Orengo nominates former MP Jacqueline Oduol for CEC post in Siaya
Gabon’s military coup has overthrown a powerful political dynasty. Here’s what to know
Investigators Look Into Death of Indian Businessman Discovered in Gigiri
Share This Article
Facebook Email Print
Previous Article First serious conflict over the education bill is observed by South Africa’s coalition government.
Next Article Novelty from a Kenyan engineer breathes new life into vehicle engines
about us

We influence 20 million users and is the number one business and technology news network on the planet.

Recent Posts

  • Woman stabs husband to death in Kisumu
  • Mpox: Two people dead as Mombasa intensifies surveillance amid rising cases
  • Singer Bella Thorne claims colleague Charlie Puth turned on her for not sl33ping with him
  • Son of Mexican Drug Lord ‘El Chapo’ agrees to cooperate as he pleads guilty in US
  • Aston Villa pre-season guide: Fixtures and streaming information

Recent Comments

No comments to show.
Newsunplug KenyaNewsunplug Kenya
© Newsunplug Kenya. All Rights Reserved.
Welcome Back!

Sign in to your account

Username or Email Address
Password

Lost your password?