Auditor General Unmasks How NHIF Payroll Was Abused
While the nation grapples with the aftermath of the Ksh.20 billion loss due to fabricated medical claims at the National Hospital Insurance Fund (NHIF), a recent Auditor General’s report, received by the public health insurer in mid-September 2023, uncovers additional corruption within the fund. This new revelation details the embezzlement of millions of shillings through the manipulation of payroll for salaries and allowances.
The Auditor General highlighted an issue labeled as an exaggeration in the expenses related to staff. According to the financial records, NHIF stated that it had paid its staff a total of 4.86 billion shillings for the period ending in June 2022.
Nevertheless, the audit conducted by the Auditor General indicates that a total of Ksh.4.81 billion was utilized, resulting in nearly 50 million shillings that lacked proper explanation or documentation regarding its expenditure.
There were doubts about the accuracy of the NHIF payroll, as there were raised issues regarding certain employees receiving excessive salaries and allowances.
In the fiscal year 2021/2022, fifteen employees received excess house allowance totaling 536,800 shillings. Seventeen staff members were paid an excessive amount of 1.62 million shillings as acting allowances. Additionally, two suspended employees received more than half of their basic salaries, and five staff members earned their full basic salaries totaling Ksh. 8.28 million while under suspension.
The fund’s procurement procedures were discovered to have been misused, leading to improperly carried out contracts amounting to Ksh.306 million.
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The report highlights that five contracts, scheduled until June 2022, raised concerns because their implementation began before the contract was fully established.
The Auditor General’s examination of the fund’s financial systems revealed that there was a significant overestimation of the budget allocated for acquiring ICT-related licenses, reaching as high as 296 percent.
The estimated expenses for the licenses were anticipated to be 12,105,907 shillings, but the real spending amounted to 48 million shillings.
However, despite obtaining the IT infrastructure through these tenders, not all of it was utilized. For instance, although 1700 endpoint antivirus licenses valued at 7 million were purchased, only 823 were actively used, leaving 877 licenses unused.
The examination revealed security issues within the NHIF’s database and operational systems, posing threats to the fund’s information systems internally and externally. The Auditor General cautioned that these vulnerabilities could potentially jeopardize the confidentiality, accuracy, and accessibility of information, including financial data.
Certainly, the reports highlight cases where certain healthcare providers inflated claims by manipulating data within systems, while others managed to secure claim payments without adequate documentation.
The auditor general’s report contributes to the ongoing EACC investigations into the fraud at NHIF.
Auditor General Unmasks How NHIF Payroll Was Abused
