National Social Security Fund (NSSF) retirees face the risk of losing 8.1 billion shillings to questionable land deals and infrastructure projects.
A report by the Auditor General called into question certain transactions carried out by the management of the NSSF for the year 2018/2019.
Auditor General Nancy Gathungu cited the delayed construction of the 4.1 billion shillings Hazina mall, the delayed sale of the 1.7 billion shillings Milimani executive apartments and the questionable purchase of the 2.2 billion shillings of 350 acres in Tasia Phases 1 and 2, all in Nairobi.
The report also highlighted the irregular disposal of 69.6 acres of undeveloped Mavoko land, valued at 126 million shillings.
On the Hazina Trade Center, the report said a 4.1 billion shillings contract was awarded for the construction of 15 floors, which were to be completed by December 31, 2019. The project began in 2013.
At the time of the audit in May 2020, it appeared that 3.4 billion shillings had been paid to the contractor, but a physical inspection revealed that the project was only 70% complete.
The contractor is in the early stages of laying the floor slabs and roofing, with the main interior work still to be completed.
Management, however, claimed that the Covid-19 outbreak and the restrictions that resulted from it had hurt the supply chain of contractors.
To complicate matters further, a claim of Sh 871.6 million by the contractor resulting from an inactive work stoppage.
According to the report, the Milimani apartments were completed and delivered in April 2019, after which the board approved the sale. The fund was to sell 94 housing units with DSQ at Sh3.2 billion and another 10 housing units without DSQ at Sh310 million.
However, at the time of the audit in April last year, sales amounted to just Sh 831.2 million.
“Management has indicated steps taken to allow potential buyers to finance the remainder and vacant units on favorable terms, but under the circumstances, it is not clear when the project will be completed and whether the public will be happy with it. money on investment, ”Gathangu said.
Retirees could also suffer losses from multibillion-dollar land deals for which title deeds are not yet available.
In Mavoko, Machakos, land of 69.16 acres was irregularly sold in 2011, subdivided into seven plots and sold for 126 million shillings (18 million shillings each) to a real estate company. However, only Sh12.6 million was paid. The balance was to be paid within 90 days.
But NSSF management says the contract was not terminated and blamed the delay on a dispute over the physical location of the plots.
On the 2.2 billion shillings of Tasia land, the NSSF has yet to issue title deeds or build infrastructure paid for by landowners.