Treasury seeks Sh3.8bn for civil servants’ NHIF cover

The National Treasury is seeking Parliament’s approval for a Sh3.8 billion allocation for payment of civil servants’ National Health Insurance Fund (NHIF) cover in the supplementary budget.

Treasury Principal Secretary Julius Muia told members of the National Assembly that Treasury was yet to pay NHIF premiums for the current financial year.

Treasury did not allocate any money for the NHIF cover for civil servants in the budget.

Mr Muia says the omission was meant to give Treasury enough time to collect data on the amounts needed following expansion of the scheme.

He was appearing before the National Assembly’s Finance and Planning Committee to defend the ministry’s request for additional funding for its operations.

He was also tasked to defend requests for state agencies such as the Kenya Revenue Authority, Kenya Railways Corporation and Kenya Ports Authority.

Treasury allocated Sh3 billion for civil servants’ NHIF cover for the financial year 2020/21.

“The Sh3.8 billion will be used to clear the outstanding NHIF arrears,” he said.

The government introduced more than 14 new categories of insurance covers for civil servants in 2020 to enhance their welfare and that of their families.

The new plan also covers members of the National Youth Service, an addition that has significantly raised the Treasury’s annual spending on medical covers.

Speaking at the time, Treasury Cabinet Secretary Ukur Yatani said the cover would run on a co-insurance model involving about 30 insurance companies who would share the risk with the NHIF.

“The co-insurance and facultative reinsurance model adopted under this scheme is in tandem with a global insurance market practice that not only spreads the risk but also drives efficiency and effectiveness in the settlement of claims,” he said.

The scheme enhanced the existing group personal accident cover and work injury benefits cover.

It also added a comprehensive group life cover to cater for all causes of death, including Covid-19.

Treasury was one of the biggest beneficiaries of the supplementary budget estimates presented by Mr Yatani to Parliament last month, with a net addition of Sh12.49 billion to its budget, which is a 7.9 per cent increase from the June budget.

The biggest single gainer was the struggling national carrier Kenya Airways (KQ), which was allocated Sh26.5 billion for a bailout that would enable it to restructure as part of turn-around efforts.

The Kenya National Bureau of Statistics (KNBS), which is domiciled at the State Department of Planning under the ministry, got an additional Sh586.33 million for population surveys.

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