Civil society goes to court over NHC house allocations

Top government officials, including the permanent secretaries in the Office of the President and Prime Minister, will be on the spot this week when a civil society organisation launches court action over skewed allocation of houses by a State corporation.

The National Housing Corporation (NHC) has been embroiled in controversy over the last few months after dozens of apartments were allotted to senior civil servants and politicians to the detriment of ordinary Kenyans who had applied.

Documents from the NHC indicate that among those who benefited are top public officers in the grand coalition.

Acting head of public service Francis Kimemia was allocated a house in the Kileleshwa scheme as was Dr Mohamed Isahakia, the PS in the Prime Minister’s office.

The pair, along with several other politicians, state corporation chiefs and PSs, paid for the housing units well after the deadline for settlement of deposits, elbowing out eligible members of the public and NHC staff.

Youth Platform for Change lawyer Antony Oluoch told the Sunday Nation that the group will cite Article 35 of the Constitution which guarantees freedom of information to demand that all the allottees that received units after the deadline be named.

The group will also seek cancellation of the allocations that came after the end of the advertised deadline.

“All State organs and public officials are bound under Article 10 of the Constitution to observe the principles and values outlined in the law, which include transparency, accountability and respect for the rule of law. When there are procedures that need to be followed, they should be followed to the letter. In the case of NHC, it is unconscionable that a scheme that should offer affordable housing to a majority of Kenyans is manipulated to benefit a privileged few. There is a threatened right here, the right of equality of treatment under the law.”

The controversy was touched off by a damning internal audit report that found that the corporation’s management had abused the house allocation process to offer numerous units to senior government officials at the expense of NHC staff and the public.

The board audit committee found that senior staff had become “super landlords” owing to the lack of transparency surrounding the allocation process, with 78 members of staff of a total staff complement of 260 receiving multiple allocations totalling 209 units.

One senior staff member had seven houses in her name and 14 others allocated to relatives. The committee recommended that the contract of managing director James Ruitha and several senior staff members be terminated and recommended the prosecution for abuse of office of Mr Bosire Ogero, the board chairman.

The investigation exposed a pattern where top government officials were offered housing units by the MD although they had not applied for the units.

The allocations point to substantial conflict of interest with the wife of Housing minister Soita Shitanda benefiting from an allocation at a housing scheme in Kakamega while Lands PS Dorothy Angote, who is represented on the NHC board, received two allocations.

In the Kileleshwa scheme, a number of top government officials are listed as beneficiaries. Apart from Mr Kimemia and Dr Isahakia, Dr Salome Gichura Wanjiku, education attaché at the Kenyan High Commission in London, received several units.

Other PSs who have been named are Ms Mary Ngari (Medical Services) and Mr Andrew Mondoh (Special Programmes), whose relative, a staff member at the NHC, got several housing units.

Assistant minister Margaret Wanjiru and Kenya Railways MD Nduva Muli also appear in the Kileleshwa list.

Civil society organisations say the allocations were irregular because they came well after the housing allocation committee met on December 17, 2009 and finalised the list of successful applicants for the 105 units.

Eighty units were listed as sold and 25 were to be reserved for NHC staff. But in what the board audit committee called a process of handing houses to “parachuted allottees,” numerous allocations were subsequently made to senior officials.

“The allocation exercise has shown an entrenched practice in which about 10 per cent of units in every scheme will be reserved as ‘special cases’ at the discretion of the managing director, purportedly to be allocated to high level personalities making requests for allocation … This practice is highly irregular and arbitrary and not supported by any policy and against known ethics,” the report reads.

Most of the beneficiaries of the controversial allocations began paying for their units in May 2011, many months after ordinary Kenyans had settled their payments at the end of 2009.

Apart from Kileleshwa, several other schemes were found to have been marked by allocations outside the normal procedure.

In Nairobi West, Ms Angote and Kenya Ports Authority head Francis Ndua Gichiri received allocations outside the normal timetable.

Ms Angote was assigned one unit in the Kakamega Tenant Purchase Scheme as was Mr Shitanda’s wife, Soita Betty Glorious.

Mr Shitanda on Saturday said he had done nothing wrong and rejected claims of conflict of interest given the fact the NHC falls under his ministry.

“These are houses built for the public. My wife applied after the deadline because the Kakamega units were not fully taken up, and she got it like anyone else,” he said.

Mr Muli also said he followed the normal procedure in applying for the Kileleshwa apartment.

Pressed on the fact that internal documents indicate he made his first payment long after the deadline for payments by wananchi under the formal process, Mr Muli said the blame should fall on the NHC.

“If internal systems failed, then it cannot be blamed on the buyer. The buyer would not know how internal systems work.”

Dr Isahakia gave the Sunday Nation a letter from a Mr Agutu J.W.O. of the NHC to him indicating that he had successfully applied for the house. The letter is dated September 13, 2011 and his first deposit was paid on the same day. This is nearly two years after the December 2009 cut-off for house allocations.

Foreign Affairs PS Thuita Mwangi said that although he was indicated as having been allocated a house in Kileleshwa he had failed to secure it and gave up his interest in the scheme.

“I had applied for a house and paid a deposit some three or four years ago. But I was not able to pay the balance. I thought I should pursue other things, and I gave it up to another buyer and got my money back. It’s not my house. In any event, I had applied before construction began.”

When the board report into the allocations came to light, a directive was issued that the matter should be investigated by the Efficiency Monitoring Unit.

The EMU falls under the office of the Prime Minister whose administrative arm is headed by Dr Isahakia, one of the beneficiaries of the Kileleshwa scheme.

Civil society groups complain that this was an effort to cover-up wrongdoing and want the court to demand new, exhaustive investigations.

In a further twist, it has emerged that Mr Vincent Ouma Nyagilo, the director of the Efficiency Monitoring Unit, was himself a beneficiary of one housing unit in the Kakamega NHC scheme.

Mr Nyagilo told the Sunday Nation he applied following the right procedure. Challenged on why he had not declared this fact in the EMU report that said there was nothing wrong with the process, he asked:

“Why should I declare that? That was not the issue we were investigating. We were looking at the question of multiple allocations.”
The other officials named in the documents could not be reached on Saturday.

The planned court action will be one of the most significant public interest litigations carried out since the new Constitution was enacted.

The new law declares that citizens have a right to housing. The NHC’s core mandate is to “promote low-cost houses, stimulate the building industry and encourage and assist housing research”.

The contention of civil society is that the housing schemes are instead benefiting the elite. This assertion is made in the light of the fact that hundreds of ordinary Kenyans routinely apply for these schemes without success. In the Kileleshwa project, deposits were made exceeding 350 per cent of the target.