Written By maboko on Friday, July 18, 2014 | 1:23 AM
Kenya Auditor-General Edward Ouko raises queries over Sh337bn
The government cannot confirm whether Sh337 billion spent in
2012/2013 was used lawfully as required by the Constitution, the Auditor
General has said in a new report that paints a grim picture of how
taxpayers’ money is used.
According to the report
tabled in the National Assembly on Thursday by Majority Leader Aden
Duale, the Sh337 billion came from 130 financial statements with adverse
and disclaimed opinions out of 343 statements scrutinised.
The
Auditor General’s report will now be scrutinised by the Public Accounts
Committee, which invites accounting officers in each ministry to answer
the queries raised.
An adverse opinion from the
Auditor General means that the accounts were incomplete or misleading,
and he could not establish whether the money was spent lawfully and in
an effective manner.
It also means that the auditor
cannot arrive at any meaningful opinion from the scrutiny of the
statements. There were 45 statements with adverse opinion, representing
13 per cent of those studied by the auditors.
Among
ministries and departments that failed to provide documents to support
their expenditure for a total of Sh33.9 billion were; Internal Security,
State House, Foreign Affairs, Home Affairs, Planning, Defence,
Information and Communication and Education.
Mr Ouko
said the audit covered “authorisation and approval of expenditure,
budget procedures, management of bank accounts and a review of the
internal control systems” set up by the ministries and other agencies.
FUELLED ECONOMIC GROWTH
The
report also reveals that only 17 per cent of the money allocated in the
Budget was spent on development. This represented a reduction by 10 per
cent compared to the 2011/2012 financial year. The amount was way below
the 30 per cent target that would have fuelled economic growth.
Mr
Ouko blamed the failure to account for the Sh337 billion on “weak and
inadequate” maintenance of accounting records in ministries and
departments during the year. There was also a perennial problem on the
maintenance of bank and cash accounts, poor management of imprests and
cases of expenditure without the approval of Parliament.
When
the report was tabled in the House, Speaker Justin Muturi asked the
Public Accounts Committee (PAC) to speed up the scrutiny of the reports
because the money devolved to counties is calculated based on the latest
audited accounts.
PAC, which is chaired by Budalang’i
MP Ababu Namwamba, is currently scrutinising the report from the
2011/2012 financial year. The team aims to have its scrutiny and
recommendations on government spending influence Budget allocations for
ministries in the future so that those that have wasted or not accounted
for funds get less.
Unlike last year, when Mr Ouko
read the summary and then tabled the reports in the House, there was no
formal presentation and Mr Duale tabled the report like he does other
papers.
The formal presentation on live TV was meant to
lend to the report the significance accorded to the reading of the
Budget statement by the National Treasury Cabinet Secretary.
Despite
the reported failures in accounting, the Auditor General notes that the
number of clean statements has increased from 15 in 2011/2012 to 41 in
2012/2013. The other positive news was that excess expenditure incurred
without the approval of Parliament totalled Sh38.4 million, down from
Sh7 billion the previous year.
There was also a high absorption rate for Budget funds at 90 per cent.
The
report also reveals that although in its Budget statement the
government had indicated that it intended to spend Sh1.23 trillion, the
actual amount spent was Sh1.11 trillion. This is an increase of Sh194
million from the previous financial year, when Sh920 million was spent.
RECURRENT EXPENDITURE
Of
the Sh1.11 trillion, Sh611 billion was spent on recurrent expenditure,
Sh190 billion was spent on development and Sh312 billion on the
Consolidated Fund Services.
The Consolidated Fund is
the principal government account into which all government revenue is
deposited and whose expenditure must be approved by Parliament.
According
to Mr Ouko, recurrent expenditure increased by Sh118 billion and
Consolidated Fund Services by Sh97 billion but development expenditure
dropped by 10 per cent.
“It is unfortunate that
development expenditure not only decreased by 10 per cent compared to
last year (2011/2012) but was also 17 per cent of the total expenditure
which falls below the target threshold of about 30 per cent recommended
for the country’s economic growth.”
Development
expenditure also had the highest under-expenditure at Sh67 billion, with
the recurrent vote also failing to spend Sh22 billion.
The Consolidated Fund Services had an under-expenditure of Sh33 billion.
