NSSF CEO David Koros on the Spot Over Missing Millions in Cash Register
David Koros, the Managing Trustee of the National Social Security Fund (NSSF), appeared before the Public Investments Committee on Social Services Administration and Agriculture on September 7 to address discrepancies in the fund’s cash books discovered by the office of the Auditor-General for the fiscal year ending in June 2021.
During the hearing, the committee convened by Vice Chairperson Caleb Amisi addressed several issues, including the Fund’s recorded investment income of Ksh21 billion, which included Ksh124 million in interest on corporate bonds.
However, a significant omission that prompted concerns was the Ksh16,624,953 in interest income earned from corporate bonds that were not recorded in the cash books. The Committee requested clarification regarding this disparity.
In response to this matter, Koros explained to the Committee that the funds had been invested in the East African Breweries Limited (EABL) medium-term note. This corporate bond was issued in April 2017 with a 14.7% interest rate and a March 2022 maturity date.
“Chair, unexpectedly, EABL redeemed the bond on 14th June 2021, earlier than expected, and credited the principal amount and interest accrued to the fund on 28th June 2021. There was an early redemption notice to all investors. We got the full value of the bond and reported it in the financial statements for the year ended June 2021. All this information was provided to the auditors during an audit,” Koros elaborated.
In response to this explanation, the Committee Chair, Saboti MP Amisi, ruled that Koros must provide the Committee with copies of the pertinent agreements.
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During the hearing, it was revealed that rental income debts totaling Ksh541 million had remained outstanding and unresolved for more than two years.
According to the Auditor-General, NSSF neglected to explain why these rent arrears had not been paid off or written off as bad debts.
Koros defended this delay by attributing it to the COVID-19 pandemic, which did not sit well with the committee; Nandi Hills MP Kibor Benard Kitur questioned whether the fund was using the pandemic as a pretext to misappropriate public funds.
“Chair, it is in the public domain that Covid-19 came later than 2018. Does it mean NSSF is hiding under COVID-19 to steal public funds,” Kitur asked.
NSSF’s Koros maintained his stance, noting that tenants at various government institutions had similarly cited the COVID-19 pandemic as an excuse for non-payment.
Following the conclusion of the hearing, the committee instructed Koros to provide supporting documentation for the arguments made.
NSSF CEO David Koros on the Spot Over Missing Millions in Cash Register
