Investigations by The Weekly Vision reveal that during the same period, the County Government of Nairobi had contracted AAR to provide medical cover to her employees. AAR further sub-contracted Bliss Medical Services and Nairobi West Hospital to offer both inpatient and outpatient services
The latest report by Auditor General CPA Nancy Gathungu dated 16th November 2022 reveals irregularities in how the Nairobi City County Executive colluded with AAR healthcare to extend an existing contract without following procurement laws. According to the report titled “Report of the Auditor General for the County Governments for the Financial Year 2020/2021 volume I – County Executives”, on Page 445, it is revealed that Ksh. 230m was paid to an insurance provider for the provision of medical cover to the County Executive employees for July 2020 and August 2020.
Investigations by The Weekly Vision reveal that during the same period, the County Government of Nairobi had contracted AAR to provide medical cover to her employees. AAR further sub-contracted Bliss Medical Services and Nairobi West Hospital to offer both inpatient and outpatient services.
According to the report, a review of the procurement of the services revealed that the Nairobi County executive extended an existing medical insurance contract by fifty-four (54) days effective 1st July 2020 to the end of August 2020. The county executive claimed that the extension was due to non-responsiveness by other bidders in a tender for the services. One wonders how AAR which had been providing the services for years finally turned out to be non-responsive and could not be awarded the tender.
The management according to the report did not provide documents for audit to support the claim that a tender had been advertised for which bidders failed to respond leading to the extension of the existing provider. The report reads in part “Further, there were no minutes of the decision and approval by the accounting officer for the extension. In the circumstances, management was in breach of the law”.
But this is not the first time AAR’s tenure at City Hall has come under intense scrutiny ever since the insurer entered into a deal with ex-governor Evans Kidero’s administration in the financial year 2015/16. Another report by the Auditor General titled “Report of the Auditor-General on Nairobi City County Executive for the year ended 30th June 2018” also reveals how AAR benefited from irregular payments from the executive.
According to the report, City Hall paid AAR over Ksh. 1,072,702,337. The report reads in part “Although the total payment made so far to AAR Insurance Kenya Limited is Kshs.1,725,488,939, no explanation has been given for paying Kshs.652,786,602 in excess of the contract sum of Kshs.1,072,702,337” The report further reveals how AAR was irregularly paid Kshs.1,725,488,939 outside IFMIS contrary to regulation 109(1) of Public Finance Management (County Governments) Regulations, 2015.
