The National Hospital Insurance Fund (NHIF) board yesterday cancelled a Sh6.9 billion tender for the provision of insurance cover for civil servants and the National Youth Service (NYS) trainees.

The tender, for which interested companies were to submit bid documents by 5pm yesterday, was curiously cancelled only hours after Health Cabinet Secretary Susan Nakhumicha had ordered the nullification of the recruitment process for the fund’s chief executive officer. The new nominee was to replace Peter Kamunyo, whose term expired in March.

NHIF board chair Michael Kamau downplayed fears that the two tenders had been cancelled due to political interferences, sources within NHIF and the Ministry of Health insisted that powerful forces had been out to ensure “their persons” won the two tenders.

“Forget about what you are reading in the social media. There was absolutely no outside interference. Even presidential elections are nullified and repeated, so what is wrong with NHIF cancelling a tender?” said Eng Kamau questioned.

Tender interference

Kamau while insisting that the cancellation had nothing to do with outside interference, lobbying or corruption, however maintained his board would not entertain any exercise that jeopardises the lives of Kenyans in any way.

“We are doing everything in a transparent manner. For the CEO, we want somebody with integrity and able to win confidence in NHIF. We want somebody who will jumpstart the stalled Universal Health Coverage (UHC),” Eng Kamau told People Daily by telephone.

Sources claimed that some board members wanted the tender awarded to an influential businessman who owns three health facilities.

Last week, NHIF had acknowledged that it was forced to undertake some illegal revision of tender documents in the Sh6.9 billion deal due to some errors.

In a statement by acting CEO Samson Kuhora on June 8, NHIF had promised to take disciplinary action against some members of staff who erred in the tendering process.

“First, it has conducted an independent review of the tender document modifications to appreciate the changes made; the system, person and process weaknesses that led to the error; and evaluate their impact on the procurement process. It has been established that clause 4 on technical evaluation was modified to read ‘General Insurance.”

“Though that is the correct position, the procedure for alteration was not followed. This has informed the disciplinary action regarding the staff responsible,” NHIF noted.

The statement further stated: “The Fund is conducting an internal review of its procurement procedures and strengthening internal controls to minimize the risk of inadvertent modifications or any potential improprieties. This includes implementing stricter document management protocols, establishing clear approval processes, and strengthening oversight mechanisms throughout the procurement cycle.”

Board cancellation

On Tuesday, only hours before the deadline for submission of tender bids, NHIF board cancelled the tender, raising eyebrows within the Ministry and insurance sector. The national insurer had advertised the tender on May 30 and prospective bidders required to submit their bid documents by June 14.

Interested firms had been asked to bid for the provision of co-insurance and facultative insurance services (consortium) for Group Personal Accident (GPA) and Work Injury Benefits Act (WIBA) for 120,047 civil servants and NYS staff from July 1 to June 30, 2024.

Insiders told the People Daily that the alteration of the tender document contravened the Public Procurement and Asset Disposal Act (PPDA) of 2015 that makes it illegal to make changes to a tender document without attaching an addendum.

Sources say the illegal amendments had been made with an aim of favouring the three health facilities owned by the influential businessman.

Recruitment suspension

On Monday, Nakhumicha had announced the indefinite suspension of the recruitment process for the substantive NHIF CEO, citing interference in what she also termed as a botched process.

The new CEO was expected to assume office last Friday, but the CS indicated that the interview process was not transparent and was skewed to favour a certain individual.

“We are going to start a new recruitment process with a reputable firm to ensure we get the right person with the right skills, who can instil the public confidence and trust in NHIF,” she said, indicating that the recruitment process had been interfered with.