Hefty fines Kenyans face ahead of SHIF rollout

Despite delays in the rollout, the mass registration began on July 1, 2024, as the government pushed the launch to October 1, 2024. This is part of the government's initiative to target all Kenyans to comply and register in the new Fund. 

SHIF dictates that those in formal employment to part with 2.75 per cent of their salaries in monthly deductions while those in informal sector to contribute Ksh.500 monthly. 

This differs from NHIF whereby, employees contribute between Ksh.1,400 to Ksh.1,700 monthly depending on their salaries and the employer matching the same. At the same time, self-employed Kenyans made a voluntary contribution of Ksh.500. 

Following the rollout of the program, the government will seek to capitalise on over 17 million youths who are not NHIF members. 

This means that anyone aged over 25, including the unemployed, will be required to pay SHIF.

In a past interview by former Health CS Susan Nakhumicha, she said that the government would observe the economic characteristics of unemployed and self-employed Kenyans such as transactions on mobile money platforms to determine how they will pay the Fund. 

“If you live in a grass house, it cannot be hidden. We will observe the economic characteristics of the unemployed to see how they will contribute," Nakhumicha said in June 2024. 

According to Section 26 (5) Social Health Act 2023, SHIF registration is mandatory for all Kenyans and foreigners residing in Kenya. 

The consequences of not registering means that those who are not members will not be able to access government services.

They will be charged a penalty equal to two per cent of the amount which accumulates based on the months defaulted. 

"A person who is registerable as a member under this Act shall produce proof of compliance with the provisions of this Act on registration and contribution as a precondition of dealing with or accessing public services from the national government, county government or national or county government entities," the law dictates. 

In the Act, any employer who fails to remit contribution without any lawful excuse is liable to face a fine not exceeding Ksh.2 million or a three-year jail term or both. 

Further, anyone who makes a false statement, whether orally or in writing, during registration to obtain preferential treatment or other benefits is liable to a fine not exceeding Ksh.1 million, 60 months imprisonment, or both. 

Any person who misappropriates any assets of the Fund is also liable, upon conviction, to a prison term not exceeding five years or a fine not exceeding Ksh.10 million or both. 

The law also penalizes any person who impersonates someone, whether living or dead, to obtain a benefit. He or she risks paying a Ksh.1 million fine or a three-year jail term or both. 

Healthcare facilities that alter information to defraud the government face a Ksh.2 million fine and also risk suspension or removal from the register of contracted healthcare providers. 

If a facility is suspended, the law states that the Social Health Authority shall publish their names in the Gazette and such institution shall cease from receiving any benefits from the Fund.