Similarities between audit of Health ministry and that of NYS are stark

I have just gone through a copy of the audit report on the Ministry of Health by Mr Bernard Muchere of the Internal Audit Directorate of the Ministry of Finance, currently posted at Afya House.

The auditor liberally uses phrases such as “red flags”, “possible fraud schemes”, and “possible double payments”.

My honest view is that for an audit as important as this, and considering the political furore it has generated, it falls short of the very high audit thresholds expected, especially when you are alleging the theft of billions of shillings from public coffers.

I expected to see clear statements of findings backed by documentary evidence. For example, when you allege double payment to a supplier, you must show payment vouchers, goods-received notes, or wire transfer instructions to show that the supplier was indeed paid twice.

Still, the auditor has given juicy insights into the shenanigans that go on during end-of-the-year procurements when funds have to be shuffled between votes and the Integrated Financial Management Information System (Ifmis) manipulated to pay well-connected suppliers.

What you see is a mad rugby-style scram to empty the vaults before the end of the financial year. Most revealing in this regard is a payment of Sh200 million that was made to Estama Investments Ltd on the last day of the financial year — June 30, 2016. The LPO was raised on the same day. How can you start and complete such a process in a single day? Incredible.

STARK SIMILARITIES

The similarities with the revelations in the special audit by the Auditor-General on the National Youth Service that exposed the theft of Sh1.8 billion that was mainly perpetrated and enabled by manipulating Ifmis are stark.

These are the exploits of a tiny elite in the government that has mastered the game of manipulating Ifmis in order to smash and grab the public purse. In Ifmis jargon, the term used is “procure to pay”, which describes a process that starts from the requisition by user departments and takes you through several stages, each requiring specific passwords — from raising an LPO, raising the so-called goods-received note, matching these documents with supplier invoices, flagging for payment, approving payment, and finally effecting the payment.

The fact that Ministry of Health officials were able to procure to pay in one day shows that what we are dealing with is a clique of individuals who collectively possess multiple passwords to enable them to initiate and complete transactions in Ifmis. Or was it a case where one superuser with a high-level password was allowed to override the whole system?

In the case of the NYS scandal, we saw how individuals in this exclusive club were given carte blanche to create as many fake suppliers into the Ifmis system as they wanted — and even book commitments as they chose.

I have said it before and must say it again; Ifmis is the nerve centre of corruption in the government. The system is dysfunctional.

DEFEND THEMSELVES

As expected, Ministry of Health officials have made a spirited attempt to defend themselves against the auditor’s allegations. I found some of the points and concerns they made in their statement to be valid. But then, I ask, why did they not provide the information they are giving out now to the auditors when it mattered?

If I were President Uhuru Kenyatta, I would fire both the Cabinet secretary, Dr Cleopa Mailu, and the permanent secretary, Dr Nicholas Muraguri, for allowing petty disagreements and sterile power struggles between them to blind and absorb them while Afya House burns.

In the recorded conversation between Dr Muraguri and the Business Daily reporter who wrote the story that broke the news of the suspicious expenditure, the permanent secretary came out looking like a man with a preposterously inflated ego — a public servant who displays a blend of cockiness that makes him unfit for public service.

Indeed, Dr Muraguri had the perfect opportunity to tell the reporter all these things he is telling us now. Instead, he chose to brag and threaten the reporter about his powers.

Who leaked the audit report to the press? I can assure you that Afya House is feverishly looking for scapegoats. There are even reports that Dr Muraguri has tried to have the auditor transferred from Afya House.

Contrary to what the likes of Dr Muraguri believe, civil servants who leak government documents related to mega looting scandals are not unpatriotic people who deserve to be punished; they are public-spirited citizens who are often forced to turn to the press to expose to the public the shady transactions of their superiors.

They should be protected.

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