Wednesday, August 11, 2010

Bid to block new NHIF rates certified ‘urgent’

By JOHN NGIRACHU jngirachu@ke.nationmedia.com
Posted Tuesday, August 10 2010 at 21:00
In Summary

-Workers score victory in first round of battle after the Industrial Court rules that case must be heard immediately

The Industrial Court in Nairobi has certified as urgent a case seeking to block the National Hospital Insurance Fund from increasing workers’ contributions.

Justice James Rika made the order on August 6, a day after the Central Organisation of Trade Unions filed the case. It will now be heard on August 20, with the Federation of Kenya Employers being enjoined.

The NHIF and other involved parties have been ordered to file opposition affidavits within seven days of receiving the order.

The NHIF and Cotu have been at loggerheads since the fund announced its plans earlier this year to increase the deductions.

NHIF board chairperson Richard Muga and chief executive officer Richard Kerich published the new rates in a Kenya Gazette dated June 29.

Mr Kerich subsequently wrote to employers asking them to effect the new rates on September 1.

“We wish to advise employers and contributors that the newly gazetted NHIF contribution rates take effect from 1st September to enable provision of Outpatient Care Services from 1st October,” said the letter.

But in its suit papers, Cotu wants NHIF restrained from “interfering, enforcing or implementing” the new rates until the case is heard and determined.

The papers say NHIF planned to implement the changes without consultation or approval “and the court has the duty to stop the fund from loading the workers with heavy contributions without proper mandate.”

Workers’ interests

In an attached affidavit, secretary-general Francis Atwoli says Cotu should be “respected and appreciated” as a member of the NHIF board.
“The contributions have to be agreed by Cotu, FKE and the government,” says Mr Atwoli.

He says the NHIF did not call a meeting of the directors to endorse the new rates and Cotu would be “abdicating its role” if it fails to fight for workers’ interests.

The new rates will see Kenyans who earn over Sh100,000 a month handing over Sh2,000 while those earning Sh5,999 and less will fork out Sh150.

Currently, all workers pay a mandatory Sh320 per month.

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