Cotu (K) Reply To The NSSF Acting Managing Trustee’s Blatant Lies On Tassia II Settlement Scheme Infrastructure Development

The Central Organisation of Trade Unions, COTU (K) as the umbrella workers’ body in the country representing over 1.5 Million Members that equally pay a monthly contribution to the National Social Security Fund (NSSF), has read with utmost bemusement a paid-up advertisement appearing in the local dailies by the National Social Security Fund Ag. Managing Trustee Mr. Richard Langat detailing generalities, explanations and ‘clarifications’ on the status of the Tassia II Settlement Scheme Infrastructure Development hitherto with deliberate omissions that duly constitute a breach of the National Social Security Fund Act, NSSF Chapter 258 of the Revised Edition 1989 (1978) overtly.

Whereas, the Central Organisation of Trade Unions, COTU (K) holds no objection to the Scheme’s background information including the processes involved in land surveying and approvals from the Nairobi City County Government, we are hesitant and not ready to be duped into any such blatant lies in the Ag. Managing Trustee’s explanation of the Tender process and Board approvals as the law is clear, any Board approvals are by RESOLUTION where members take a vote not by CIRCULATION.
This in itself is fraud and he is lying to the public blatantly when at our last board meeting of 9th December, 2013, the Ag. Managing Trustee never indicated that he intended to call another meeting on 18th December, 2013 or do so by way of circulation as he wants the public to believe.

Further, he has gone ahead to lie that I was aware of the amount involved and I declined when I am on record for having informed my fellow trustees including himself soon after the 9th December, 2013 meeting that l was leaving the country on 12th December, 2013 for London, United Kingdom.

1.0 Finance, Social Security and Investment Committee

The core business of the Finance, Social Security and Investments Committee of which l serve as Chairman is and not limited to, vetting and approving all Financial and Investment engagements by the National Social Security Fund (NSSF) and forwarding the same with recommendations for the Full Board’s decision in terms of endorsing wholly such recommendations or with variations.

Equally, debate on whether the amount involved was either Kshs. 4,629,168,275.70 or Kshs. 5.053 billion does not arise since the Ag. Managing Trustee himself in a Memo addressed to the Fund’s Ag. General Manager Finance and Investment dated 19th December, 2013 quoted the figure Kshs. 5.053 billion as the sum ‘approved’ and nowhere in the Memo that is in our possession does he mention the figure 4,629,168,275.70 (see the memo separately) and this is in itself criminal especially when the Ag. Managing Trustee disowns his own memo addressed to the Ag. Finance and Investment Manager directing the latter to cause expenditure of the same.

2.0 Board Approval

The first schedule of the NSSF Act that was fully in operation at the time as the New Act’s commencement date is yet to be gazetted is clear under section 7 that:

The Quorum for any meeting of the Board of Trustees shall be two thirds: Provided that there shall be no quorum unless there is present at the meeting at least one Trustee representing Government, one Trustee representing Employers and one Trustee representing Employees…..

In this case, employees were not represented in the meeting and if this meeting was substantive as opposed to being held through circulation, in the wisdom of both the Chairman of the board and the Ag. Managing Trustee they would have realized that there was no quorum to transact such serious business.

Further, nowhere in the Act is provided that such a colossal sum of money involved can be approved by the Board of Trustee through circulation of an Email without any subsequent full disclosure to the Board on the projects viability so far as safeguarding the Fund’s is concerned nor any comprehensive presentation on the very projections involved including on how the NSSF secure its funds bearing in mind that these quarters are yet to even pay the Kshs 2.5 billion that is the principal amount owned on plots.

Indeed its make no economic sense to keep on the viewing the figures upwards in total disregard of the economic plight of these quarters and consistently expose the Fund to a likelihood of further losses because if the squatters are unable to pay for the plots based on the initial amount, how will they now pay-back to the Fund to refund a whooping Kshs 5.053 billion to the NSSF?

In fact this informs the decision by the previous Managing Trustees who deliberately skipped pressurizing the Board of Trustees to grant approval for the development of the said infrastructure despite insistence from the then City Council of Nairobi because somebody had to take responsibility.

The Trustees that the Ag. Managing Trustee alleges to have approved the Kshs. 5.053 billion, they were approving on the basis of what? Were there any documents attached detailing how the Fund will be able to fully recover this colossal amount of money from the tenants bearing in mind that NSSF no longer now owns these plots? Where are the Minutes through which the Fund will defend the decision when called upon to justify? These are questions that the workers whom I represent on the Board will have to seek from me together with the Fund management and it will be absurd for me to rally behind a process that is clear in my mind is fraudulent and so casual yet involving billions of workers money.

As a long serving member of the NSSF Board of Trustees, there is nowhere in the History of the Fund has even Kshs 5 (five shillings) been approved through circulation. In our possession we have a letter dated 6th January, 2014 from our social partner, the Federation of Kenya Employers, (FKE) which clearly denies any involvement in the alleged circulation approval.

Thus the approval that the Ag. Managing Trustee is alleging to have received from a section of the Board of Trustees may be from the two Principal Secretaries of Labour Social Security and Services, the Treasury, the Chairman and himself and this out of nine board of trustees members, three retired, to approve such a colossal amount of Kshs 5.053 billion cannot be taken lightly especially by poor worker who toil day and night to save with the Fund with a view that the Fund will exercise prudency, accountability and transparency in investing the funds.

Notwithstanding, COTU (K) reads a sinister motive in the fact that the alleged Email circulation was done on 18th December, 2013 to which COTU (K) did not receive and as the Board of Trustees were “approving” the proposal through 19th December, 2013 it is the same day the Fund’s Tender Committee met and approved the award of the Tender to China Jiangxi International (K) Ltd and soon after, the Finance, Social Security and Investments Committee was overstepped deliberately and this is in no doubt informed by my historical background of this project.

The haste with which the process was done and bearing in mind that in our previous Board meeting there was no such communication from the Fund nor had there been any request for the process to be completed in a period of two days even without involving the plot owners who are now the tenants and whom the money would be recovered from through their payments of Kshs. 650,000 that was equally and fraudulently adjusted to Kshs. 920,000.

As representative of workers on the NSSF Board of Trustees, COTU (K) has fought all manner of battles in efforts to not only secure but safeguard workers’ funds and this has not been easy since we have had to take personal risks in order to serve NOT our personal interests but our Members. This is a duty we have been duly elected and confidence bestowed on us to execute without reneging and those keen on seeing us back-off, should prepare for even bitter battles. Our members out there are looking upon us and we will not betray this trust no matter the intimidation to our course.

It is unfortunate that the Ag. Managing Trustee is lying in attempts to qualify a fraudulent process in efforts to formalize an illegality and as long as no Board meeting was convened on the same to seek approval the amount involved in the whole process, it remains fraudulent irrespective of whether one or two trustees approved on mail circulation or not. As a Board, we have held Board retreats where we have deliberated on various issues but without a substantive Board Meeting convened in accordance with the Act, such views have remained not implementable and should be viewed as so and this calls upon the government and its investigative agencies to prove who is right in this whole saga of blatant theft in the glaring open eyes of the Cabinet Secretary in charge of Labour Social Security and Services together with those involved.

COTU (K) has, and remains opposed to such fraudulent processes that clearly flouts the laid down procedures including ignoring the law as well as pushing for such personal interests in a project where plots were sold as “ Unserviced Plots” according to the agreements with tenants in our possession. Indeed a plot sold in this respect does not require any service from the seller and that is why we are humbly appealing to His Excellency the President of the Republic of Kenya Hon. Uhuru Kenyatta who in no uncertain terms promised Kenyans that whatever his government does will remain above board to proceed and cancel these fraudulent deal that is as a result of a concoction by a few individuals out to enrich themselves.

Yours sincerely,

Francis Atwoli, EBS, MBS


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