Corruption in Kenya’s National AIDS Control Council

Written by: Kipkoech Tanui and Nixon Ng’ang’a

HIV/AIDS is one of the biggest challenges facing the health sector in Kenya, and was declared a national disaster in 1999. The National AIDS Control Council (NACC) was set up later that year to coordinate the prevention and control of HIV/AIDS. Its role became even more critical when the current government placed at the centre of its 2003–07 development plan the goal of achieving 90 per cent awareness of the disease and its effects across society.

The NACC was given control over funds pooled under the Kenya HIV/AIDS Disaster Response Project (KHADREP), financed by the World Bank, the UNDP, and the UK and US development agencies. In the 2004–05 financial year, the NACC was allocate just under KSh4 billion (US $41 million). The most significant portion of its budget is channelled into community-based organisations. It claims to have channelled KSh1.8 billion (US $24 million) to community-based organisations during 2000–03.

The NACC was set up under the Office of the President (OP). However, a more natural home for it is the health ministry, which is also a recipient of large amounts of bilateral funding and runs the National AIDS and STD Control Programme (NASCOP). The choice of the OP as home for the NACC was made ostensibly out of the government’s desire to control the sizeable budget it manages. The OP’s record belies the wisdom of this decision, however. It has been the focus of some of Kenya’s most egregious acts of corruption, often perpetrated by well-connected officials who have proved almost impossible for prosecutors to touch.

In April 2003, the OP was enveloped in scandal when it was revealed that the head of the NACC, Margaret Gachara, had been receiving a salary seven times what she should have been entitled to as a senior civil servant. She had negotiated the salary based on a fraudulent letter from her previous employer that exaggerated her earnings there. Once in office, she raised her salary even higher than the already inflated amount she had been offered. In August 2003 she was ordered to refund US $340,000 to the NACC.

Fears that the corruption did not end with her high salary were confirmed in April 2005 when a report by the Efficiency Monitoring Unit (EMU), also based in the OP, revealed that for years high-level public servants had used the NACC as their personal cash cow. There had been a number of early warning signals. An internal audit in June 2002 found irregularities in procurement procedures and in June 2003 the Global Fund to Fight HIV/AIDS, Tuberculosis and Malaria withheld a US $15 million AIDS grant until the government addressed corruption in the NACC.

The 300-page EMU report revealed that Kenya could not account for KSh3.64 billion (US $48 million) donated by the United Kingdom over five years since 2001. It put a figure of more than KSh37.3 million (US $490,000) on the amount used by NACC employees to pay themselves inflated salaries and fraudulent allowances, such as the payment of private water, electricity, telephone and home security bills. The largest sum was the money embezzled by Gachara, but others were also involved, including eight permanent secretaries or their representatives, and NACC Chairman Mohammed Abdallah, who was charged with embezzlement but later acquitted due to ‘lack of evidence’.

Even where money did find its way out of NACC to the community organisations it was intended to support, the report into its use was damning. The EMU found that on a sample examination of the community-based organisations funded by the NACC, at least half of the money allocated has been squandered.

Investigators probed three of the 10 national NGOs funded by NACC and several provincial, district and constituency-level organisations. They found wanton theft of the NACC money granted to noble-sounding projects that turned out to be sham. The worst cases involved shell organisations purposely formed to cash in on the NACC windfall. The NACC itself had cracked down on some of the so-called ‘briefcase’ NGOs cited in the report, including the Neema Children’s Centre in Nairobi. The NACC awarded Neema US $14,000 out of a World Bank grant to finance grassroots work on HIV/AIDS. It was closed down in mid-2003 after inspectors could not find a single Neema worker or a single orphan who had benefited from the children’s centre.

Money was squandered by almost all the AIDS Control Units (ACUs) formed in each ministry to sensitise staff to the disease. Grants were spent on needless seminars, usually involving the same participants. Of the US $205,000 given to the Ministry of Agriculture, for example, more than 75 per cent was spent on staff accommodation, allowances and participation fees at various awareness-raising shows, the EMU report noted. Almost one-third of the amount spent was not accounted for and was presumed wasted. Investigations into the three national NGOs revealed similar misdeeds. Par Aid, a well-connected organisation based in Eldoret, received US $100,000 for a proposal to study the efficacy of Par Aid herbal medicine in the treatment of HIV/AIDS infection.

The chairman of the Institutional Research and Ethics Committee at Moi Teaching Referral Hospital, which is part of Moi University, withdrew a letter approving the project because he was concerned that Par Aid was not serious about the study, but his decision was quickly overturned with no explanation given by the hospital’s director. The study went ahead, and the EMU report found that most of the money was spent on trips to collect the medicine, or on fuel. The medicine that should have been used in free trials was sold to desperate patients, leading the EMU to conclude that Par Aid was conducting a profitable business with NACC funds.

Corruption in the case of the AIDS Prevention Forum of Kenya (APFK) is even more blatant. Also given US $100,000 in NACC funds, its directors appear to have gone on a spending binge under the guise of organising seminars and workshops. EMU noted a claim by the organisation that it spent US $16,000 hosting school pupils at a seminar in the Chania Tourist Hotel. The schools said to have been involved denied any knowledge of the activity and said some of the pupils alleged to have participated did not even exist. Similarly, hotels refuted several account entries, saying they were either paid considerably less, or did not host the seminars at all. For example, the Hotel Big Five in Homa Bay, which was said to have hosted 150 students at a cost of US $6,200, consists of just 12 rooms and denied ever accommodating the group.

A number of APFK directors were simultaneously directors of the third NGO investigated, Technologies and Action for Integrated Development (Techno Aid), where similar practices were uncovered. Techno Aid claimed to have organised seminars and workshops for the same people as APFK, consulted academic experts who denied ever working for the NGO, and paid large bills to non-existent hotels. Both Techno Aid and APFK presented receipts for stationery from the University of Nairobi bookshop, which has disowned them as frauds.

The report points the finger of blame at the lax implementation of the NACC’s own funding rules and, in the worst cases, outright collusion between crooked NGOs and NACC staff. In some cases the NACC continued to finance organisations even when its own officers had expressed concerns over the accounting for previous allocations. As isolated cases, the funds may seem petty especially when juxtaposed with the huge sums that HIV/AIDS attracts. But in their consolidated amounts, and if spent on effective prevention programmes, life-prolonging anti-retroviral drugs (ARVs) or income-generating activities for the affected and infected, the sums are significant.

The fight against HIV/AIDS in Kenya attracts massive funding. The Global Fund has promised US $129 million over five years while the United States has pledged US $115 million. Other donors who have responded to Kenya’s appeal for more funds include UNAIDS (US $15 million) for disease mitigation initiatives and the World Bank (around US $658,000 on top of a 2004 grant of US $4 million). The bulk of these funds go to NASCOP, which has also fallen under suspicion for failing to deliver results commensurate with its budget. If there were no leakage or inefficiencies in the use of NASCOP funds, they should be enough to provide ARVs to 200,000 of the 1.4 million Kenyans who are estimated to be infected with HIV. The real figures are scandalously small. By November 2004 only 24,000 people were reported to be on ARVs.

The EMU is based in the OP, and was created in response to donor pressure to contain corruption in the institutions they support. Every state institution is liable to be investigated by the unit, but given its scant resources – staffed by just 50 people – it opts to probe those with sizeable budgets, often guided to them by rumours of sleaze.

The EMU is reputed to conduct thorough and impartial investigations. Its report, ‘Financial Management Audit of the National AIDS Control Council (NACC) in the Office of the President’ is the culmination of a two-year investigation.

The EMU has called on the Anti-Corruption Commission to investigate all the cases of fraud and abuse of office listed in the report. Gachara, the former NACC director, was sentenced in August 2004 to one year in prison on three counts of fraud and misuse of office. She was granted a presidential pardon in December 2004, along with 7,000 ‘petty offenders’ who had stolen from various government offices. Her release was publicly decried.

In response to the report, the NACC claims to have hired auditors to probe the accounts of the NGOs it funds. It says it will release funds in tranches, conditional on proof that the previous allocation was properly utilised. It ordered 20 NGOs to refund money that was misappropriated, or face prosecution. At the time of writing none had refunded the money and none had been taken to court.

The role of constituency-based AIDS councils has also been bolstered in response to the scandals. These had already been given a larger role in resolving the Global Fund’s concerns and now have responsibility to scrutinise the expenditure of NACC money. Many MPs – who are the patrons of their respective constituency councils– have welcomed moves in this direction and some have called for the NACC to be disbanded in favour of constituency-based AIDS management committees, citing bias in NACC decisions over which NGOs to fund. Whether this will help curb corruption is questionable, however. Civil society groups and the media have levelled accusations of favouritism in appointments to the constituency councils and in their decisions over the disbursements of funds.

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