Four bosses in three months: No security for NSSF managers

By Lillian Aluanga

Between August and October this year the National Social Security Fund has had four Managing Trustees. That is how slippery that position is.

Dogged by years of financial scandals worth billions of shillings, NSSF has gained fame for recording some of the country’s shortest tenures at the helm in a State corporation.

It started with the ouster of Ms Rachael Lumbasyo, the fund boss from December 2005, who was acrimoniously kicked out of office in August.

In cracking the whip, Labour Minister John Munyes alluded to claims of gross mismanagement, allegations strongly refuted by a Lumbasyo buoyed by support from the fund’s board.

The claims were nothing new to the fund, once viewed as a cash cow for the country’s political class and well connected business individuals.

But the successive appointments to the Fund, which controls Sh90b of workers pension, have shifted focus to what could very well be the country’s ‘hottest seat’ one can be appointed to.

While the noose around Lumbasyo’s neck appeared to have tightened with revelations that the fund was embroiled in a controversial sale of a prime piece of land next to the Laico Regency Hotel, the speed of successive appointments and sackings at the fund is even more intriguing.

Argument

With Lumbasyo’s exit quickly followed by the "appointment of Mr Fred Rabongo, a Marketing and Public Relations consultant, in an acting capacity, the turbulence at the fund appeared to have calmed down.

But not for long. Rabongo’s appointent was more of an announcement than being actually given the job.

With the board of trustees arguing that the appointment contravened the NSSF Act and that the minister had no powers to unilaterally name the fund’s boss, it was clear that Rabongo’s hours, not days in office, were numbered.

The board’s argument prevailed, and barely two weeks after his appointment, Rabongo was replaced by Mr James Akoya, until then the fund’s General Manager, Finance and Investment. But Akoya too wouldn’t last.

About one month after taking on the reigns at the Social Security Fund, Akoya was shown the door alongside six other managers over a Sh1.4b scandal.

Akoya’s exit followed Munye’s dissolution of the board over alleged loss of the Sh1.4b invested in the Nairobi Stock Exchange through Discount Securities Limited.

On Friday, the High Court granted Akoya and his team a life line.

The Court put on hold the dissolution of the NSSF board until the suit filed by the Central Organisation of Trade Unions is heard and determined.

But it wasn’t the first time the country’s Social Security Fund was facing allegations of impropriety.

Established in 1965 by an Act of Parliament to offer a provident fund scheme for all workers in Kenya, the fund initially operated as a government department under the Ministry of Labour.

But as membership grew, the NSSF Act was amended in 1987, transforming it into an autonomous State Corporation, operating under a board of trustees.

Thus began the intrigues in the appointment of the fund’s top employee, often hounded out of office on claims of ‘mismanagement’.

Perhaps none of the sackings at the National Social Security Fund has been as puzzling as that of Lumbasyo’s predecessor, Naftali Mogere, who, barely a week after being garlanded as a Moran of the Order of the Burning Spear, was kicked out of office.

Mogere had been feted for his efforts to "turn around the Pension Scheme" since taking over in 2002.

His sacking was seen as the first in what was rumoured to be a ‘purge’ of civil servants alleged to have supported the ‘NO’ campaign in the referendum which the Government lost in 2005.

Mogere had replaced Ben Mutweta in 2002, who after serving for only two months was pushed aside to allow for investigations into Sh250m deposited into the collapsed Eurobank.

Mutweta’s appointment appeared headed for trouble almost from the start with the then chairman of the Federation of Kenya Employers, Mr Wilfred Kiboro, and Cotu Secretary General Francis Atwoli opposing it.

With barely seven months to the General Election, Mutweta was replaced by Mogere. But his term wasn’t short of tribulation either.

At one time the fund was accused of having sold two million of its shares in the Kenya Power and Lighting Company in a record two weeks. But it was also during Mogere’s tenure that the "NSSF list of Shame" was published, naming individuals who owed the fund billions of shillings.

Some of the cases are still in court.

Mogere’s sacking elicited furious reactions from leaders in the Gusii region, coming hot on the heels of the firing of Jeremiah Matagaro as PS for Constitutional Affairs, James Ongwae and Zachary Ogongo.

Fate

But the then Labour Minister Newton Kulundu stood his ground even as claims were made that Mogere was being ‘punished’ for refusing to sanction an illegal multi billion shilling contract linked to an influential businessman.

Mogere’s pleas of innocence and dismissal of reports by the Kenya Anti Corruption Commission fell on deaf ears as he was shunted off to the National Cereals and Produce Board as Managing Director. He would later relinquish the position in 2007 to make an unsuccessful bid for the Bobasi parliamentary seat.

Others who have served as Managing Trustees at the fund have suffered unceremonious departures that have made it virtually impossible for one to finish their term.

Perhaps one of the most short-lived terms was that of Mr John Vijedi Bosse, who after two weeks in office in 1991, was moved to the Ministry of Culture and Social Services as PS.

Bosse had taken over from Mr Philp Mullei who had served since 1988.

The 1990s would open a chapter in the institution’s history marred by claims of mismanagement, corruption and a litany of ill-conceived investment projects in land and housing deals.

It was in 1992 when Opposition parties demanded action by the Government over reports that NSSF had spent billions to buy two city plots whose value was not more than Sh66m.

Among those who served in the ‘troubled 90s was Samuel Muindi, whose appointment as ambassador to Nigeria in 2000 caused an uproar in Parliament.

Muindi, who had replaced Martin Kunguru (1991-1993), was among officials blacklisted by a Parliamentary Committee which had recommended that he be barred from holding any public office owing to what it termed were irregular land transactions under his watch.

His troubles would also see him expelled from the Institute of Certified Public Accountants of Kenya (ICPAK) for "involvement in activities incompatible with the professional status of Certified Public Accountants of Kenya".

Departure

Jos Konzolo’s appointment as Managing Trustee in 2000 was greeted with optimism for the floundering institution, but like his predecessors, his departure would be swift.

A telephone call in 2002 from the then Labour Ministry PS Joshua Terer sealed Konzolo’s fate, in what was widely believed to be a behind the scenes power struggle for control of the fund by power brokers.

But it was his reaction to his sacking that spoke volumes of the fragility of the office.

Said Konzolo: "My experience with the Government has shown that when you are appointed over the radio, the sacking will also be over the same."

Konzolo, a financial analyst, stockbrocker and accountant, had succeeded real estate mogul David Masika, who in 1999 admitted the fund was having serious cash flow problems.

Seven years later, Konzolo would be cleared of charges levelled against him by the Kenya Anti Corruption Commission.

Currently, Albert Odero is holding office as the Acting Managing Trustees even as it emerges that he signed the letter authorising the buying of shares through the troubled Discount Securities Limited.

But if the history of appointments to the fund’s top position is anything to go by, then perhaps he too could be on borrowed time.