Taxpayers may have lost as much as Shn 13 billion in at least 13 government agencies, three national funds and five donor-funded projects in the past fiscal year.
Auditor General Nancy Gathungu revealed the details in a new report on the national government’s ledgers for the year ended June 30, 2020.
Of the Sh13 billion, ministries, departments and agencies (MDAs), Sh3.1 billion missed Sh2.3 billion of national funds and Sh8, 6 billion in donation.
“The institutions’ failure to fully support payments raises doubts about the authenticity of the reported spending,” said Gathungu.
She added, “That Failure to support payments could also be an indication of weak internal controls and governance in the companies concerned. “
The amount was a decrease from the Sh16 billion that government agencies fail to explain were able to perform audits for the fiscal year ending June 2019.
Budget experts say there is no excuse for accounting officers not to receive receipts and tender documents to support audit requests.
Dr. Abraham Rugo of International Budget Partnerships Kenya told the star that even if tenders were in a hurry, they must be documented.
“In order for the auditor to issue such an opinion, it means that not all of the evidence has been provided. It is a big concern. When it comes to actual spending, there is no excuse for not being able to prove how the money was used, “said IBP Kenya Country Director.
” Even in one In the event of an emergency, an accounting officer must explain during the audit why they chose a particular procurement and spending method. ”
The Ministry of Health was the largest breach as it failed to explain the Sh1.24 billion spending.
Part of the unsupported expenses were in variations for leased medical equipment services of Sh1.13 billion.
MOH could also make payments of Sh28 million for emergency and refugee aid as well as 82 Do not support millions of Shillings paid to 15 companies.
The copies of the original Articles of Incorporation, Tax Compliance, PIN Certificate and Company Confidential Business Questionnaire were not submitted for review.
The Ministry of Devolution supported Sh 720 million. as unconfirmed transfers in 22 counties Sh660 million and Sh60 million for plane tickets.
The animal husbandry department was able to raise 526 million Sh. allegedly incurred in the counties and on new assets.
No disbursement and expense reimbursement plans were presented and Gathungu questioned the validity and accuracy of the payments.
The ICT department ignored 220 million shredders used to clean up the Ruaraka data center after a fire.
The money spent on a director was based on a request made in November 2019. That was more than one . Year before December 5, 2020 when it was paid.
In her review of the department’s books, Gathungu announced that there was no detailed report of the fire outbreak detailing the date, cause and extent of the damage . and estimated repair costs.
The gender department failed to take into account the Sh104 million bills paid during the year and Sh1.8 million for printing, advertising, information and services.
In the crop production department, the auditors failed to trace 76 million shredders for insurance costs, 11.5 million Shh paid to various Saccos, and the number of Sh4 million employees.
Auditors were able to make the partial payment of. did not confirm Sh90.5 million by the Environment Department for an Airborne Lidar Photographic System. It was procured for remote consultation and remote procurement
The Basic Education Department could not explain the Sh25 million paid to Moiben TTC.
The National Cohesion and Integration Commission supported Sh24.8. not paid millions for meetings, retreats, workshops, funerals and court visits.
In the National Fund, however, Gathungu reported a possible loss of Sh1.96 billion to the National Government Affirmative Action Fund, which arose from 47 counties Reimbursement of expenses was not supported.
Auditors were unable to trace Sh332 million to the National Humanitarian Fund. The Strategic Food Reserve Trust Fund did not account for Sh2.2 million in attendance fees for board members.
Other unsupported donor spending included Sh22 million from Moi University for a World Bank-supported textile project and Sh13 million at Lake Victoria Environment Project III.
The accounting officers also failed to raise $ 8.5 billion in donations to the World Bank-funded Kenya Urban Support Program (Kenya Urban Support Program). Even on days when they were outside the country and were already receiving foreign subsistence allowances, MEPs were transferred irregular payments for domestic livelihoods and mileage allowances amounting to 5 million other expenses for 204 billion Shillings.
Details show that Covid-19 has a deficit of 46 billion Sh. for recurring votes, 53 billion Shillings. for development, 72 billion Sh. for consolidated fund services and Shs 31 billion.
“The underfunding of the development budget by 12 percent was attributed to restrictions in the collection of revenues and delayed disbursements of donor funds,” says the audit report.
Gathungu expressed concern that the government has continued to spend huge amounts of money on projects that stalled or were incomplete after the contracts expired.
“Even more blatant,” she said, “is that some of these Projects due to delays in payment of certificates of completion of milestones already achieved. “
The auditor noted expenditures of Sh3.8 billion and added that” others have been revised to amounts above the original contract amount which led to costs. “Escalations.”
“In addition, payments were made to projects that seem to have stalled, which raises doubts about the value for money for such expenses,” says Saga te Gathungu.
She cited unjustified payments for the Kimwarer Dam and the Sigoi Wei Wei Project (Sh3.4 billion), which headed Nyandarua County headquarters (Sh 101 million) and stal the Supreme Court of Turkana (101 million Sh.).
In addition, 111 million Sh. spent on stalled or completed drought resilience projects in Turkana, Baringo and Marsabit counties.
The report further revealed that MDAs have exceeded fiscal year ending June 2020 with outstanding bills of Sh101 billion, contrary to the instruction of President Uhuru Kenyatta to pay bills by the end of the year.
In June 2019, the President ordered government agencies to settle all outstanding bills released for payment. The Treasury Department later threatened to stop releasing funds to non-compliant agencies.
Outstanding bills for MDAs through June 2019 totaled Sh 80.5 billion, an increase of 26 percent in Compared to current bills.
“This is the highest number of pending bills reported in the last five years,” said Gathungu. She revealed that the bills in the 2017-18 fiscal year would have increased to Shs 46.5 billion. amounted to 16.7 billion Shillings in 2016-17. and 2015-16 to Sh 20 billion.
resources, with some of these bills leading to penalties, putting more of a strain on available resources, “said Gathungu.
She raised concerns about suppliers of goods and services for public institutions could also expect unjustified financial burdens from their financiers.
Outstanding invoices of 64.1 billion Shillings reported under donor-funded projects were not cleared during the year paid, but carried over to the 2020-21 financial year.
The auditor warned of a failure to pay invoices, leads to the retention of cash in circulation in the economy and affects the smooth operation of suppliers and SMEs.
“Also, the non-payment affects the collection of sales tax and withholding tax,” she said.
“All of these factors, taken holistically, require the manager to be strict took action to minimize the incidence of outstanding invoices, ”said the auditor.
(Edited by V. Graham)