April 25, 2019

Shyira Hospital In Debt Trap Involving Kenyan Bank

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This new Shyira District Hospital was opened on July 1, 2017. However, it found a huge debt accumulated by the old facility which is located a distance far away

The magnificent Shyira District Hospital unveiled by President Paul Kagame in July 2017 is back in the news, but for all the wrong reasons; it paid a Kenyan Bank some Rwf 91m as repayment for a loan yet it did not acquire that loan.

In addition, the Rwanda Social Security Board (RSSB) is deducting money it is supposed to refund monthly to the hospital for medical services provided to the more than 200,000 local resident in Nyabihu district, north-western Rwanda.

As a result, these issues are leaving the hospital management with no time to concentrate on their core mission, instead they are busy looking for solutions to get out of the debt trap.

The situation goes back to before this new hospital was built.

In 2015, the Anglican Church reportedly obtained a loan of Rwf 175m from Kenya Commercial Bank (KCB) in Rwanda. The loan was to purchase the land on which Shyira hospital sits today.

Government and the Church had agreed to build a new hospital to replace a dilapidated one built by the British Anglican Church Missionary Society in 1931.

Government agreed to put up the facility and provide everything else to keep it operational, while the Church would provide the land. That is how the land on which the hospital is located in Shyira sector was bought.

Fast forward, the 140-bed hospital was opened on July 1, 2017, after less than two years of construction by the Rwanda Defence Forces (RDF) at a cost of $7m.

However, the old Shyira hospital had been in the debt situation from 2015.

In late 2015, RSSB transferred Rwf 165m to the account of Shyira Hospital. The money was way more than the actual transfer the hospital was supposed to have received.

On December 16, 2015, Kivu Diocese got wind of the new cash and directed Shyira Hospital management in a meeting to transfer Rwf 51m reportedly to buy land on which a new facility was to be built.

In March the following year 2016, Kivu Diocese held another meeting with Shyira Hospital management in which it was agreed that the hospital pays half of the Rwf 175m loan from KCB.

As a result, between March-September 2016, a total of Rwf 91million was transferred to KCB from Shyira account.

Shyira Hospital was required to transfer money monthly to the account of Kivu Diocese, in which Shyira region and the hospital fall.

Bishop Nahimana Augistin, head of Kivu Diocese and chair of the Board of Shyira Hospital says the decision to have the hospital repay a diocesan loan was done in the best interest of the hospital.

The Chronicles was not able by press time to speak to Bishop Nahimana, but he did speak this week to state broadcaster RBA.

“When we suddenly saw money on the account, it was like manna from God. We thanked God for the money and went ahead to pay the loan,” said Bishop Nahimana, with laughter, in interview with RBA.

It was in late 2017, more than a year later, that RSSB realised that it had transferred a lot more money to Shyira Hospiral. It demanded that the hospital brings back the money totaling about Rwf 144m.

With the hospital unable to find such money, the Ministry of Finance and RSSB settled that the latter will be deducting 20% monthly from the total transfer the hospital is supposed to get from the provider for services offered to patients who are on health insurance.

RSSB has therefore been deducting Rwf 4.9m from RSSB transfers every month, leaving the hospital with a large hole which is affecting its ability to buy medicines and take care of other expenses.

“At the moment, we are unable to pay pharmacies and for other medical supplies because of the shortfall caused by the 20% which RSSB deducts from what they transfer to us,” said Major Emmanuel Kayitare, the director of Shyira District Hospital.

Aerial view of Shyira District Hospital, which is currently facing serious financial difficulties born from a loan of Kenya Commercial Bank Rwanda (KCB Rwanda) which it did not acquire as the hospital

As the situation stands at the moment, the hospital is stuck with a debt of Rwf 144m it owes RSSB, yet it had no role in accumulating the debt. The whole case arose from the original loan which the Anglican Church got from KCB bank Rwanda.

The Finance Ministry, Health Ministry and Parliament have all resolved that Kivu Diocese take ownership of this RSSB debt and pay from its coffers. But the Diocese is not bothered.

The Chronicles has established that the Finance Ministry has informed the Anglican Church that if government pays the entirety of the RSSB debt, then the Church will lose its seat on the ownership of the hospital. It will be 100% owned by government.

Meanwhile, it has also emerged that as of April, there is no Government representative on the Board of Shyira hospital.

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