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Praised as whistleblower, auditor in Sh5 billion health scam cuts lonely figure in field governed by authoritarian norms

The sources say Dr Mailu has engaged in a fierce battle with remnants of his predecessor James Macharia’s administration who have tried to influence tendering even after the reshuffle that saw Macharia taken to the Transport and Infrastructure docket.

By Free Press Reporternewsdesk@kenyafreepress.comSaturday, 05 Nov 2016 16:21 EAT

Benard Muchere, in a picture published by The Standard last week.

Mr Bernard Muchere, the government financial auditor whose report on financial corruption at the Ministry of Health has sparked a national furore over the past two weeks, has earned a place for himself among Kenyans as the courageous whistleblower. Mr Muchere has been compared in some reports to David Sadera Munyakei, the newly-employed clerk at the Central Bank of Kenya who blew the lid on the Goldenberg scandal, the fictitious export compensation scheme in which the Kenya government paid billions of shillings to companies associated with the scam’s mastermind Kamlesh Pattni.

In a civil service ruled by conservative norms, the internal audit department is one of the most tamed given the sensitive information its practitioners come across in their daily work. Those like Mr Muchere who do not hesitate to speak their mind and who can candidly put pen to paper about the profligacies they identify unsurprisingly cause lots of discomfort not only to seniors but colleagues as well.

A number of government auditors contacted by the Kenya Free Press spoke of an isolated man spurned by his colleagues. Not many like to work with Mr Muchere, who some said has a very high opinion of himself, notions that have only gained currency as Mr Muchere has come under siege following the leakage of his report. The Kenya Free Press was informed by that the Internal Auditor General, who is reponsible for the department, has disowned the report prepared by Mr Muchere on the basis that it failed professional standards, citing the leakage of the report to media among other reasons.

According to practices for the internal audit department, an internal auditor prepares an interim report, then hands it over to the auditee through the accounting officer for response on questions raised. This is done by forwarding the report to the permanent secretary. The PS then gets the feedback of all those concerned, including the head of accounts, finance or sectoral directors. If the management (PS and others) disagrees with the report, they give information supporting their disagreement, which the auditor takes into account in the preparation of a final report. The auditor then makes his or her changes and thereafter forwards the report to the Internal Auditor General.

There are legitimate concerns about some of the strictures in the process. For example, before the internal auditor forwards his report to the IAG, the auditor and the management have to agree on all the major observations, which is unlikely in the case of a big scam like the one Mr Muchere has unearthed. It is provisions like these that have made internal audits lame, serving no effective purpose other than preparing corrupt officials to cover up their tracks before external auditing.

It was such a situation that the leakage of Mr Muchere’s report tried to avoid. The leak has spurred a national discussion on the extent of corruption in the Jubilee government by unearthing how the president’s relatives are taking advantage of government procedures for the advancement of marginalized groups. In the leak and other decisions, the auditor is accusing of using systems unknown to his practice. For example, it has been reported that he handed over his report to the cabinet secretary, Cleopa Mailu, rather than the principal secretary. “It was a real anomaly for the auditor to do this,” said a finance expert familiar with government procedures.

“The internal auditor reports to the PS, yet in this case Mr Muchere seems to have provided his report only to the CS. If this is true then amounts to professional misconduct and a violation of the Code of regulation for internal auditors,” the source said. If the PS feels that there are issues requiring the intervention of the cabinet secretary, he or she can escalate the matter to the top.

In a case where the Internal Auditor General cannot defend the work of an auditor, the guidelines require the appointment of independent auditor(s) to complete the controversial reporting, who in this case have since been appointed by the Treasury. However, given the furore Mr Muchere’s report has caused, there is concern that the government is keener to cover up the scam than get to the bottom of it. This is especially the case, said one source, when the IAG makes determination on which officers to deploy in a well-publicised case like the one obtaining at the health ministry.

Internal auditors also spoke of contradicting principles in government since the passage of the new constitution. During the first two years of the Jubilee government, cabinet secretaries, led most notably by Anne Waiguru, piled pressure on them to hand over reports to the CSs. Many auditors got such instructions from cabinet secretaries but ignored them. Mr Muchere's is the first case where an auditor handed his work to the CS rather than PS.

While some officials have accused Mr Muchere of leaking the report and want him punished for the act, this suspicion could be based on anecdotal supposition only, given his apparent better relationship with Mr Mailu and not Muraguri. The cabinet secretary, sources informed us, had potential interests in having the report leaked. The sources say Dr Mailu has engaged in a fierce battle with remnants of his predecessor James Macharia’s administration who have tried to influence tendering even after the reshuffle that saw Macharia taken to the Transport and Infrastructure docket.

According to a well-placed source, two of the companies in the report were linked to a close business associate of the former minister’s.


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