Prime Cabinet Secretary Musalia Mudavadi has deployed inspectors to two key state agencies riddled with graft as part of the state's measures to stem corruption.
The sleuths from the Inspectorate of State Corporations (ISC) will camp at the Kenya Medical Supplies Agency (Kemsa) and the National Hospital Insurance Fund (NHIF) to “safeguard public resources".
The deployment signals a possible and looming shake-up at the two agencies that have been cited for being havens for grand corruption and misappropriation of public funds.
The ISC is under Mudavadi's office.
Mudavadi has said that ISC will be revamped and strengthened so it has the capacity to take a more active role in combating corruption and misappropriation of funds in state corporations.
“Under powers vested in the Office of the Inspector General (Corporations) Section 18(2) of the State Corporations Act, inspectors have been deployed to these institutions (Kemsa and NHIF) to safeguard public funds and conduct thorough investigations into the reported improprieties with a view to surcharging all those involved,” Mudavadi told the Star.
The Inspectorate will resume surcharging, in accordance with Section 19(1)(d) of the State Corporations Act, he said.
Under the provisions of the State Corporations Act (Chapter 446 of the Laws of Kenya), the inspector general (Corporations) has extensive powers that include the authority to call for and inspect all relevant records, documents, and premises of state corporations and attend their meetings if necessary.
ISC has authority to disallow unlawful expenditures, surcharge individuals responsible for unauthorised or negligent actions, and certify the amount due from those held accountable.
In carrying out this mandate, Mudavadi said he does not expect exceptions or exemptions by ISC.
He has pledged that all those found responsible for financial losses or deficiencies will be surcharged in accordance with this law.
“However, this will not be a substitute for being held accountable before the law for any other breach,” he said.
The Prime CS has since issued instructions to the newly appointed acting Inspector General of ISC, James Mungai Warui, to ensure effective running of state corporations.
He said safeguarding public funds is not an option under Warui’s watch.
“In particular, the government expects ISC not to second guess itself on fighting corruption, wastage and misuse of public resources in state corporations,” he Mudavadi said.
The ISC will work hand in hand with the Office of the Auditor General, the Director of Criminal Investigations and the Ethics and Anti-Corruption Commission to fight graft in government.
Mudavadi said recent reports of cases involving the misappropriation of public funds in Kemsa and NHIF have highlighted the urgent need for stronger measures to prevent corruption and enforce accountability in State corporations.
An expose revealed that a number of private hospitals are part of an elaborate syndicate working with unscrupulous NHIF staff to rob unsuspecting citizens and government of healthcare funds.
Kemsa has been in the news following a botched tender for the supply of mosquito bed nets to prevent malaria in millions of low-income households.
The Prime CS warned staff within state corporations who engage in corruption or misuse public funds that they will face dire consequences.
“Let all and sundry beware of intense activity to identify and expose any instances of impropriety, ensuring that those responsible face the full force of the law,” he said.
He said public officers should be the vanguard in isolating and reporting wrongdoers in state corporations.
ISC can disallow any item of account that is contrary to the law or to any lawful direction given to a state corporation.
He also has the powers to surcharge the amount of any expenditure disallowed upon the person responsible for incurring or authorising the spending.
He can surcharge any sum that has not been duly brought to account upon the person responsible.
ISC can also surcharge the amount of any loss or deficiency to anyone whose negligence or misconduct has caused the loss of deficiency.
Mudavadi said out of the total pending bills amounting to Sh481 billion, a significant portion of Sh401 billion is owed by state corporations and semi-autonomous government agencies.
“This glaring disproportion raises concerns about the blatant breaches and disregard of applicable laws by some state corporations. This state of affairs is untenable and cannot be allowed to persist,” he said.
Mudavadi assured the public the government is steadfast in its commitment to restoring trust and accountability in state corporations.
He urged Kenyans of goodwill receiving state corporations’ services to join the war against sleaze in government.
“Kenyans joining this endeavour will send a clear message that, as a society, we abhor impropriety at any level. By reporting incidents of impropriety in the use of public funds, we will be saving on our taxes. On its part, government has placed investigative and prosecution agencies on high alert in assisting whistle-blowers to unearth financial irregularities - including procurement malpractices - and ensure that those responsible face the full force of the law,” he stated.
“All citizens should support the efforts of ISC by reporting any suspicious activities or malpractices they come across in state corporations," Mudavadi said.
On May 19, President William Ruto pledged to protect public resources in a renewed fight against corruption in the country.
The head of state said no one found culpable will be spared, not even his friends.
“No one will steal or waste public resources. I will deal with them,” he stated.
His announcement came after he had cracked the whip at Kemsa.
Public Health Principal Secretary Josephine Mburu was sent home alongside the entire Kemsa board and CEO Terry Ramadhani.
Ruto's government also suspended 27 officials in connection with the release of condemned sugar.
Kenya Bureau of Standards MD Bernard Njiraini was among top officials suspended over the sale of the condemned sugar.
Others suspended include officers from the Kenya Revenue Authority, DCI, EACC, Anti-Counterfeit Agency, Agriculture and Food Authority and the Kenya Ports Authority.