Obama exits: Massive cash rip-o­ffs exposed

NAIROBI: Before he left the country on Sunday, US President Barack Obama delivered a riveting speech rallying Kenyans to tackle corruption, citing it as the biggest threat to the Government’s growth.

Obama repeated the message in his address to the African Union in Addis Ababa, Ethiopia  Tuesday, the first by a US president, warning that corruption was “draining billions of dollars” from the continent.

But barely 24 hours after the US leader left Kenya for Ethiopia aboard Air Force One, the State’s auditor released a report that highlighted questionable financial transactions in the national government.

Auditor General Edward Ouko lifted the lid on questionable spending of nearly a third of the Sh1.2 trillion spent in the 2013-14 financial year, detailing massive unexplained, plunder of State funds expenditure, irregular payments and in some instances blatant plunder of public resources by sections of the national government.

The report on the financial statements for the year 2013-14 tabled in the National Assembly Tuesday indicts ministries, departments and independent commissions for suspect expenditures totaling Sh450 billion.

As a pointer to the extent of reckless spending of taxpayer’s money, the report reveals that only 1.2 per cent of the Sh1 trillion budget allocated to the national government during the period under review was lawfully and effectively utilised.

The Auditor was further unable to express his opinion over financial statements of Sh28 billion due to lack of sufficient and accurate information and explanations.

“I was unable to confirm whether expenditure totaling Sh390,266,678,529 was incurred effectively and lawfully as required by Article 229(6) of the Constitution, “ Auditor General Edward Ouko said in the report dated June 29.

Auditors flagged unsupported expenditure, excess expenditure, pending bills, management of imprests, maintenance of bank and cash accounts and maintenance of accounting records among the concerns in public spending.

cash bail

Among those fingered for wastage is the National Police Service Commission that spent Sh31 million on rent covering a 6-month period for offices not occupied.

Auditors also uncovered suspected looting of cash bail deposited in exchange for freedom from custody. Police stations in Nairobi alone could not account for Sh60 million in purported refunds to accused persons.

Seventeen ministries and State departments were found to have used a total of Sh66.7 billion, but failed to avail the documents in support of various expenditure.

The Ministry of Health had the highest amount of unsupported expenditure totaling Sh22.5 billion.

It was also cited for spending Sh24 billion without the approval of Parliament as required by the law.

The Ministry of Transport and Infrastructure failed to avail documents in support of various expenditures totaling to Sh22 billion and had an excess spending of Sh77 million.

The Ministry of Education, Science and Technology, the Office of the Attorney General and Department of Justice, Ministry of Agriculture, Livestock and Fisheries and that of Energy and Petroleum were some of those with unsupported expenditures of over sh1 billion.

Eight ministries and State agencies were said to have excess expenditure amounting to Sh24,566,651,642. Six additional ministries and departments would have exceeded expenditure against recurrent or development votes.

The Auditor General has cited massive mismanagement of imprest by State officers who were holding a total of Sh351 million, which ought to have been recovered or accounted for before the close of the financial year on June 30, 2014.

Officials in the Ministry of Sports, Culture and the Arts have the highest amount of outstanding imprest amounting to Sh135 million.

Government officials in the ministries of Information, Communication and Technology, Foreign Affairs, Petroleum and Energy, Environment, Water and Natural Resources; and the Ministry of Education, Science and Technologies were holding imprest amounting to between Sh10million and Sh70 million.

The Auditor General has questioned payment of Sh1.2 billion by the Ministry of Interior and Co-ordination of National Government for purchase of land and houses for the General Service Unit in Ruaraka along Thika Road.

And the Defence ministry could not prove the taxpayer got value for money from the Sh1.1 billion paid for 32 military vehicles.
The report has revealed that the the National Treasury paid Sh228 million to service a loan the national government guaranteed in 1970 for construction of the Ken-Ren Chemical and Fertiliser Company, a white elephant.

The audit also revealed that the Strategic Grain Reserve Fund failed to properly account for Sh109,830,561 allegedly incurred in the purchase of gunny bags, spending of Sh281,439,987 incurred on storage and fumigation and Sh238,313,713 incurred in transport costs.