Hospital Boss Grilled After Interns Disappear With Ksh930K Loans

Hello and welcome to the Money News Roundup Newsletter. Today, we are covering government interns who disappeared with Ksh930,000 in salary advances, an impasse between the National Assembly and Senate over a Ksh465 billion allocation, and how French firms pressured Kenya to pay Ksh6.2 billion.

Interns Disappear With Ksh890K Salary Advances

Moi Teaching and Referral Hospital (MTRH) officials, led by CEO Philip Kirwa, were on Tuesday put on the spot by Members of Parliament after extending salary advances to interns who have since failed to repay the loans.

The Numbers: According to lawmakers, the salary advances totaled Ksh930,000 and were given to medical interns who had been contracted for less than a year.

“(This was) in contravention of the hospital’s human resource policy. Notably, Ksh890,000 of the amount advanced has remained outstanding for more than a year, with no evidence of recovery efforts,” the MPs noted.

The anomaly was first flagged by Auditor General Nancy Gathungu, who noted in her report that “The hospital might not recover the amount of Ksh930,000 advanced to interns.”

The Bigger Picture: The committee also raised concerns about anomalies in the hospital’s inventory records. Financial statements as of June 2020 reflected a stock balance of Ksh356 million, yet auditors found expired drugs worth Ksh4.5 million included in the inventory. Some stocktake reports were also found to be unsigned.

CEO's Defence: Kirwa explained that salary advances are offered to interns to support their living expenses, as they often experience delays in salary disbursement.

“The interns are posted by the Ministry of Health, and due to delays in salary processing, we offer salary advances to support their upkeep. Most of these are recovered before the interns complete their terms. However, in rare cases where interns fail to clear procedurally, we pursue recovery through the Ministry and county governments,” he told the National Assembly’s Public Investments Committee.

Catch Up Quick: Last year, healthcare interns and related professional bodies held protests and filed five petitions challenging the Salaries and Remuneration Commission’s (SRC) decision to slash intern pay from Ksh206,000 to Ksh70,000, arguing that it was discriminatory. The government maintained that the previous pay was unsustainable. In November 2024, the High Court upheld the SRC’s decision.

National Assembly Rejects Senate Push to Raise County Funding by Ksh60B

A fresh budget impasse is brewing after the National Assembly on Tuesday, June 3, rejected Senate amendments to the Division of Revenue Bill, 2025. The Senate had proposed increasing the equitable share to county governments by Ksh60 billion—from Ksh405 billion to Ksh465 billion—sparking concerns over the country’s fiscal sustainability.

Majority Leader Kimani Ichung’wah led the pushback, citing limited fiscal space and warning that the proposed increase would strain national finances. “This is an increase of about Ksh65 billion above what was agreed. Bearing in mind the fiscal space of the country, it may not be practical to increase,” he told the House. He called for the formation of a mediation committee to resolve the standoff swiftly.

The Senate's amendments would significantly boost county budgets in the 2025/26 financial year—an appealing move for devolved units facing cash flow challenges. However, with rising public debt and constrained government revenue, the National Assembly maintained that the increase was unrealistic and could derail national budget plans.

The disagreement now heads to a mediation committee, as required by Article 113 of the Constitution. Members from both Houses will attempt to find common ground to prevent delays in the approval of the national budget—a process with far-reaching implications for service delivery, county operations, and economic planning across Kenya.

How French Consortium Forced Kenya to Pay Ksh6.2B for Failed Contracts

Kenya paid Ksh6.2 billion to a French consortium after cancelling a highway expansion deal and reassigning it to Chinese firms. Business Daily reported that the Treasury said it opted for an out-of-court settlement to avoid a lengthy and expensive legal battle, using emergency powers under Article 223 of the Constitution.

The cancelled deal involved the Nairobi-Nakuru-Mau Summit road, originally agreed under former President Uhuru Kenyatta. The French firms protested the move, especially as it came just before President Ruto visited China. Chinese companies have since submitted bids to revive the project, with the government targeting an August start.

4 in 10 Supply Chain Officers Unfit, KISM Audit Reveals

Over 40% of Kenya’s supply chain practitioners are either unqualified, incompetent, or operating illegally, according to a nationwide audit by the Kenya Institute of Supplies Management (KISM). The compliance check across 109 institutions revealed a 42% noncompliance rate, with counties identified as the worst-affected. Of particular concern, 15% of practitioners were found to be working without licenses, violating the Supply and Procurement Management Act.

According to the Standard, KISM has launched disciplinary action against 116 individuals, with 93 cases set for hearings. The institute is working with county governments, the Education Ministry, and the National Treasury to strengthen professionalism and support the rollout of digital procurement. KISM warned that licensed professionals who break the law risk deregistration as efforts continue to clean up the sector and safeguard public resources.

Kenyans Lose Ksh300 Million in Another Eldoret Scam

Over 200 Kenyans who were defrauded in a Ksh300 million job scam caused chaos in Eldoret after discovering that the director of the recruitment agency, Noble Global Services Consultants, had fled the country. A report by People Daily showed that the victims, promised high-paying jobs in Canada, stormed the agency’s offices only to find them shut down. The agency's director, Gilbert Serem, reportedly fired all staff and escaped to Australia after learning of the planned protest.

Among the victims are former NGO workers, civil servants, and fresh graduates who paid up to Ksh750,000 each. One victim, Julius Misoi, revealed he resigned from a job in South Sudan and even convinced his sister to quit her job based on Serem’s promises. Speaking at Nandi Park, the victims condemned the agency for deceiving them over two years with fake overseas job offers.

𝐀𝐮𝐝𝐢𝐭 𝐔𝐧𝐜𝐨𝐯𝐞𝐫𝐬 𝐇𝐨𝐰 𝐍𝐒𝐒𝐅 𝐋𝐨𝐬𝐭 𝐊𝐬𝐡𝟗𝟎𝟒 𝐌𝐢𝐥𝐥𝐢𝐨𝐧 𝐓𝐡𝐫𝐨𝐮𝐠𝐡 𝐖𝐫𝐨𝐧𝐠𝐟𝐮𝐥 𝐓𝐚𝐱𝐞𝐬 𝐏𝐚𝐢𝐝 𝐭𝐨 𝐊𝐑𝐀

An audit of the National Social Security Fund (NSSF) for the year ending June 2024 has revealed deep financial mismanagement, with billions of shillings lost through poor investments, wasteful spending, and failure to recover tax refunds. Notably, the Fund failed to recover Ksh904 million in taxes wrongly paid to the Kenya Revenue Authority despite gaining tax-exempt status. It also purchased a parcel of land in Upper Hill for Ksh115 million, whose title was later revoked, and lost Ksh27.2 million in two poorly performing company investments.

The report further flagged the Fund for holding Ksh38.4 million in shares of a loss-making bank and incurring a Ksh272 million capital loss after buying and selling government bonds at a premium. Meanwhile, five idle properties in Nairobi’s CBD are valued at Ksh4.02 billion but generate no income, and eight tenants owe nearly Ksh14 million in rent arrears. Despite such losses, the NSSF still spent lavishly: Ksh317.6 million on travel and conferences (some from unregistered suppliers), Ksh51 million on vehicle operations, Ksh410.9 million on renovations, and Ksh36.3 million on acquiring property and equipment—including Ksh2 million for a reception desk. Read more on Citizen Digital.