Kenya’s central bank boss finally forced out

Dr Mullei officially handed over to his deputy, Mrs Jacinta Mwatela, who had earlier been appointed in an acting capacity. An official at the bank said Muthaura’s letter to Mullei asked him to step aside until a ruling is made on the corruption charges facing him in court. The letter was delivered to Mullei Wednesday morning while he was in his office. Mullei is said to have left the Central Bank premises after receiving the letter, and stayed out for nearly four hours. He returned after 2pm and held a meeting with departmental heads, then officially handed over to Mrs Mwatela before leaving. Earlier, Central Bank officials had remained tight-lipped over the matter, maintaining that they had no knowledge of such a letter. Lawyer Mutula Kilonzo, who is representing Dr Mullei in the corruption case, also said he was not aware his client had received such a letter. He, however, maintained that Muthaura had no authority to write such a letter and would be acting in breach of the law should he attempt to do so. “Only the President can communicate such a decision to the Governor in an official letter, with the Presidential seal,” he said. “Any attempt by Muthaura to meddle in this matter would be unlawful and would definitely invite legal action,” Mutula said. Mullei has been in the eye of a storm since his arraignment in court on abuse of office charges last Thursday. He has denied all the four charges involving illegal awards of consultancy projects worth Sh9 million to his son and associates and was released on a Sh5 million cash bond. A day after he was charged, Attorney-General Amos Wako told journalists that Mullei could not continue holding office since the Corruption and Economic Crimes Act demands that any public official charged with corruption stands suspended until such a case is determined. Constitutional lawyers, however, argued that the law could not apply in the Governor’s case since he was protected by security of tenure as provided for in the Central Bank of Kenya Act. They said since the Economic Crimes Act and the CBK Act are all Acts of Parliament, none could override the other. One day after Wako made the pronouncement, the National Social and Economic Council convened a Press conference at Central Bank where Planning minister Henry Obwocha and Muthaura announced that Mullei had been suspended and his position taken by Mrs Mwatela in an acting capacity. On Monday, a defiant Mullei reported to work and appeared determined to continue holding office despite attempts to push him out. Meanwhile, Kenya stood to lose Sh7 billion from the Global Fund for HIV/Aids if the Treasury did not release an audit certificate by last Thursday. This could put the lives of up to 53,000 people living with HIV/Aids in serious jeopardy. The patients, who are already on antiretroviral (ARV) therapy, are at risk of developing drug resistance due to incomplete treatment. The Global Fund has, since September last year, been demanding a report from the Treasury on how money earmarked to combat HIV/Aids, malaria and tuberculosis was spent. The Treasury is the principal recipient of the Global Fund money for HIV/Aids, tuberculosis and malaria, while the Health Ministry is responsible for distribution of life-prolonging drugs. The Global Fund signed a Sh26 billion ($354 million) grant with the Government in December 2002. Out of Sh9 billion ($134 million) released for a two-year budget, only Sh2.5 billion ($34 million) has been put into use. In addition, the Global Fund has given provisional approval of Sh584 million ($8 million) for a round five TB proposal for over two years. The Deputy Executive Director of the Global Fund, Hellen Evans, however, said Kenya’s fate would be determined in two weeks’ time when the fund’s board meets. She was speaking at the ministry of Health Headquarters, where she met Health minister Charity Ngilu and organisations whose activities are funded by the Global Fund. Ngilu said the country had done well in fighting Aids, malaria and tuberculosis. She said by December 2003, only 2000 people living with HIV/Aids were on treatment but the figure had risen to 70,000 this year and hoped the figure would hit 140,000 by the same time next year. She said the funds had been used properly and hoped that the support from the Global Fund would continue. On Wednesday, the United Civil Society Coalition on Aids, TB and Malaria demanded the release of the audit certificate to avert a crisis. Coalition director Dr Ignatius Kibe expressed concern that the country had “allowed itself” into such a grave situation. “The certificate of audit has not been released. We request that the auditor-general releases the certificate before expiry date, which is less than 24 hours,” Kibe said during a press conference at the organisation’s offices in Nairobi. He said the Global Funding Geneva Deputy CEO and the country’s portfolio manager were in the country and ready to receive the audit certificate. Last week, Kibe claimed that reports were sent to Local Fund Agents without the auditor’s report despite the assurances from the Government that the documents were in order. Of the seven grant projects approved for Kenya, he said, only the first two HIV/Aids projects had been satisfactorily implemented. Meanwhile, Health minister Charity Ngilu has said Kenya’s external debt was compromising funding for the health sector. Speaking during the launch of the Second National Health Sector Strategic Plan at the Kenya College of Communications and Technology, in Mbagathi, Nairobi, Ngilu urged donors to cancel the country’s debt. Danish Ambassador, Mr Bo Jensen, attended the launch on Wednesday. Jensen earlier criticised the Government’s healthcare per capita allocation of $6.2 (about Sh446), terming it too little. “The foreign debt currently stands at a staggering Sh402 billion, on which the Government spends over Sh33 billion annually to service,” said Ngilu. She said the health sector was in dire need of more funding to enable it implement its health programmes. The Second National Health Sector Strategic Plan will be implemented over five years, up to 2010. The plan provides guidelines for programmes to ensure an efficient and high quality healthcare system that is accessible, equitable and affordable to every Kenyan. The first phase of the project for the 2005/06 period will cost about Sh65 billion, while the estimated total cost of the project upon completion in 2010 is Sh412 billion. Ngilu urged the G8 countries to include Kenya in the list of Highly Indebted Poor Countries to qualify for a debt waiver. She also criticised donors for failing to inform ministries of funds allocated to them, and mostly channelling money to non-governmental organisations. “I would like to request our development partners to provide information on their financing framework for 2006/7 early enough to facilitate our budgeting and planning,” said Ngilu. ‘

April 2006
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