Employers disown Sh5bn NSSF project

SSF’s controversial Sh5 billion Tassia II project took another twist yesterday after a second board member disowned it.
Ms Jacqueline Mugo, the Federation of Kenya Employers (FKE) representative joined Mr Francis Atwoli of the Central Organisation on Trade Unions (Cotu) in questioning the manner in which such a large expense was approved through e-mail.

The two key stakeholders on the NSSF Board of Trustees accuse Managing Trustee Richard Lang’at and Labour Cabinet Secretary Kazungu Kambi of misleading the public on how the decision was reached to spend the massive sum on infrastructural development within the Tassia scheme in Nairobi.

“I sent an e-mail to the chairman (Mr Adan Mohammed) and acting Managing Trustee (Mr Lang’at) on January 1, 2014, as a follow up to clarify what needed to be done by the board and copied it to the six current board of trustee members raising questions on the project.

The e-mail was not responded to,” said Ms Mugo.

“It is therefore misleading for the Cabinet Secretary and the acting Managing Trustee to report to the public that the board approved the Tassia project.”

Ms Mugo also questioned the hurried manner in which the project was purportedly approved and a contractor picked.

She demanded that Mr Lang’at calls a board meeting to discuss the controversial project.

Mr Atwoli was the first to publicly disown the project, after which he mobilised trade unions to threaten a national strike if it was not cancelled and the NSSF chair and the Managing Trustee sacked.

He faced harsh criticism from Cabinet secretary Kambi who supported the project and accused him of pursuing personal interests.

In a statement published yesterday, Mr Lang’at dismissed critics and claimed that all the formalities and been assented to by all board members except one, Mr Atwoli.

But in a rejoinder published today, Mr Atwoli, questioned the award of the tender to a Chinese firm, China Jiangxi International Ltd, saying it was hurried.

He said request for approval was sought through an e-mail circulated on December 18 and the project was approved the following day.

Despite Mr Atwoli’s and Ms Mugo’s objections, five members of the NSSF board approved the Tassia II Settlement Scheme project through e-mail and not at a full board meeting as required by law.

Denies involvement

Cotu, which was responding to a statement by Mr Lang’at, noted that FKE had last week denied being part of the project.

“We have a letter dated January 6 from FKE which clearly denies any involvement in the approval,” said Mr Atwoli.

Cotu, which represents workers’ interests in NSSF, had in September called for the project to be stopped until a review of the investment committee had discussed the matter.

In Mombasa, Cotu executive board members from the Coast region asked Mr Kambi to resign as Cabinet Secretary over the saga.

Early this month, Mr Atwoli opened the lid on what he described as the “scandal of the year” when he said that NSSF had irregularly approved the release of more than Sh5 billion of workers’ money for the Tassia project.

Mr Atwoli alleged the fund’s managers approved the controversial payment without following proper procedures.

According to him, the money was to be used to build roads and a sewerage system in the new estate, a cost that he said should be met by owners.

The NSSF board has nine members, three of who have retired.

He also claimed that the board did not have enough members to approve an expenditure of such magnitude.

Mr Atwoli claimed no meeting was held to approve the project.

“Even if they had a quorum, an item involving approval of Sh5.053 billion from an earlier proposal of Sh3.3 billion cannot be approved through a mere note,” he said.

He said Mr Lang’at had, on December 19, signed a communication to the effect that the board had approved the Sh5.053 billion development.

“Any such investment must first be considered by the sub-committee on investment, which I chair, as required by the NSSF Act but that was not done,” Mr Atwoli said.

The pension fund bought the land in 1995 for Sh2.2 billion. Squatters, however, invaded it in September 2001, claiming they had bought it.

In 2004, the court ruled in favour of the fund and paved the way for the squatters to be evicted but this proved difficult because the matter became politicised, forcing NSSF to sell the plots to the squatters.

A total of Sh2.5 billion was expected from the proceeds of the sale but by May 2011, only Sh1.1 billion had been received.

As a result, NSSF decided to develop the estate to recover its money.

Mr Atwoli has asked President Uhuru Kenyatta to intervene and cancel the tender.

Additional reporting By Wachira Mwangi