Another scam in making – Weekly Citizen


Over 70,000 Kenyatta University students are worried that the institution risks closure based on the report by the Auditor General which revealed that KU is in a critical financial crisis that threatens grounding of operations.
The report attributed the financial mess at the institution partly to previous management’s misplaced investment in two campuses, one in Kigali (Rwanda) and the other in Arusha (Tanzania).

Former KU Vice Chancellor Prof Olive Mugrenda

More than Sh500 million was sank into the two campuses by the then vice chancellor of the institution Olive Mugenda. The purchase price and renovation of the building in Kigali was particularly inflated with some sources indicating that this was done without following due process so that an individual within the leadership could benefit.
It is worth noting that in spite of Prof Mugenda’s pumping of millions of shillings in the two campuses, both never operated to enable return on investment. Was due diligence done or was this scheme mooted to enable siphoning of cash from KU? Whereas the Arusha Campus never attracted any students for over 10 years, the Kigali one was never given authority by the Rwandese government to operate. This was the case because Mugenda the then vice – chancellor neither sought the approval of the Commission for University Education nor the support of the Rwandese government to establish the campus.
The focus was on pocketing the cash through dubious deals of purchase. According to the Auditor General, the Rwandese government declined to allow the operations of the campuses even before the admission of any students because of this debacle. The burden of explaining and justifying the establishment of the campus has persisted beyond the regime of Mugenda who was the mastermind of the many construction projects for the purpose of “tenderpreneurship”, working in cahoots with some well known operatives in high places within the government. Financial analysts indicated that the adverse effects of the misplaced investment during Mugenda’s leadership are behind the growing financial distress and paralysis at Kenyatta University.

Prof Wainaina

Former Health PS Peter Tum

Beside the waste of funds in acquiring the two campuses in foreign countries, Mugenda exited as VC leaving the university heavily indebted in terms of commercial loans amounting to billions of shillings borrowed from banks to fund mainly non-academic construction projects that are not relevant to teaching, research and service, which is the core mandate of the university. Experts well versed in construction projects have estimated that if all the construction projects undertaken during Mugenda’s regime are to be sold at current market rates, the accruing amounts cannot clear the loans that were taken. During Mugenda’s term of office for instance, one would question the logic and relevance of borrowing huge loans to construct a shopping mall that has never attracted clients, a high-end beach hotel at the coast that people hardly visit, a campanile that has no economic value nor relevance to teaching and learning, a directorate building that is already falling apart and does not support the mandate of the university, or the purchase of floor tiles worth hundreds of millions of shillings, to mention a few. There is no doubt that unnecessarily huge loans amounting to billions of shillings for overpriced non-core construction projects have brought the institution to its knees. Members of staff say that Mugenda is famous in KU for her appetite for big money which she siphoned over her tenure.

Health CS Cicily Kariuki

It is said that there were efforts to divert attention from financial mismanagement of KU in her last two years in office.
To make matters worse, some operatives in government grabbed the referral hospital that is legitimately a facility of the institution. As such, the Sh8 billion Kenyatta University Teaching and Referral hospital was taken over and turned into a state corporation under a board headed by Mugenda following a presidential executive order dated January 22 2019. The facility which was built by Kenyatta University on its land, was designed to be an income generating project as well as a teaching facility while at the same time providing highly specialised healthcare to patients on referral from other hospitals or institutions within or outside Kenya. This model was to make the facility financially sustainable in view of dwindling capitation from the exchequer to public universities. Many have expressed fear that going by history, the hospital will be looted. They point at the current situation at Kenya Methodist University that is bleeding.
The construction of the KU Hospital was commissioned on October 7 2011. It has a bed capacity of 600, 21 beds in the intensive care unit, eight operating rooms, an emergency room, a dialysis unit and imaging equipment. The hospital was planned to be the only molecular imaging centre (MIC) in the region, outside Egypt and South Africa, for purposes of detecting and treating cancer at an early stage. We have learnt that unfortunately the KU Hospital has been lying idle for about two years after its completion due to orchestrated wrangles over who should manage it for obvious reasons.
Voices within the ministry of Health have confided that the hostile takeover of Kenyatta University Hospital is said to be motivated by powerful cartels and tenderpreneurs keen to control the multibillion shilling tenders for the supply of specialised equipment for cancer treatment, in addition to another Sh4 billion earmarked for operationalisation, including recruitment and training of about 2000 members of staff.

Murang’a women Rep Sabina Chege

This also follows a recent visit by the parliamentary committee on health chaired by Murang’a woman representative Sabina Chege that recommended that Treasury allocates KU Sh1.6 billion to trigger the release of an undisbursed loan from the Chinese government running into billions of shillings. The potential scandal around KU hospital is being finalised despite directors of top firms being among powerful individuals summoned by anti-graft detectives for questioning over the stalled Sh63 billion dam scandal that has resulted in three cabinet secretaries including Treasury’s Henry Rotich recording statements over the issue.

Mugenda is said to be the lead person and the face of the alleged tenderpreneurs within government, working together with a well-connected supplier of medical equipment in the country. Sources also indicate that the tenderpreneurs are the ones that pushed through and succeeded in convincing the powers that be to have Mugenda appointment as the non-executive chair of the board of directors of the KU hospital, despite a court order in petition No 78 of 2016 issued on November 23 2016 that ruled that the hospital was to be owned by KU as a teaching and research facility. Legal experts define a non-executive chair as a figurehead holding a ceremonial position in executing board decisions. However, sources say that she has taken over the role of the CEO rendering Toro redundant on the pretext that Andrew Toro cannot be fully trusted to operationalise the hospital following his dismal performance in Thika and other health facilities where he was the head.
Mugenda who is well connected within the government is seen to wield power as a commissioner in the Judicial Service Commission. The JSC is responsible for the appointment, promotion and deployment of judicial officers, including judges in the supreme court that are responsible in determining any disputes that may arise from the 2022 election that is being billed to be a do-or- die exercise by those keen in controlling president Kenyatta’s succession.
It is also not lost on observers that Mugenda has never handed over to the incumbent Michael Wainaina, but remains on Kenyatta University payroll earning close to Sh1m per month despite not undertaking any teaching or research duties since her exit from KU as vice chancellor in the year 2016. She rushed to court and got orders for her pay to continue in full until the case is determined. Currently she is also earning as a commissioner in the Judicial Service Commission. This raises ethical and conflict of interest queries that are currently before the Labour and Relations Court for determination.
There are fears within Kenyatta University that the KU hospital will be run down to the level of other public health facilities in the country including the poor performing KNH. For that reason, reliable sources within Kenyatta University indicate that some section of student leaders under pressure from comrades taking medical courses in KU, and also staff unions are organising to storm the facility. The court ordered the barring of Mugenda from taking over the management of the facility on grounds that there has been no competitive recruitment process, nor does Mugenda have a medical training background. Further, the unions allege that there are several pending cases forwarded to the Ethics and Anti-Corruption Commission of alleged multibillions shilling financial malpractices during her 10 year reign as the vice chancellor and chief executive officer of Kenyatta University. The cases have yet to see the light of day courtesy of Mugenda’s operatives whom she has compromised over the years.
It is said Andrew Toro, the acting CEO is already feeling the heat. Many say that Health CS Cicily Kariuki is also on the board has interests. Other directors are Kithinji Kirangu and Gladys Ogallo. It is said Kariuki personally handled the KU file and sidelined Peter Tum the then principal secretary in the ministry. The composition of the board instituted by Uhuru Kenyatta is suspect.


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