Audit report reveals how millions of shilling are lost through stalled projects, ghost payments in counties

A new report by the Auditor General has revealed rampant corruption in county governments, exposing how public funds are splashed on stalled projects, inflated allowances, and irregular procurements.

The 2023-2024 audit shows that millions of shillings have been lost to mismanagement, raising serious concerns over whether taxpayers are getting value for their money.

The report points to widespread financial malpractice, including misallocation of funds, ghost projects, and unaccounted-for expenditures.

Auditor General Nancy Gathungu warned that despite repeated concerns in past audits, county governments have failed to implement proper financial accountability measures.

The report flagged Kwale for non-compliance with recruitment policies, including failure to meet the required threshold for hiring persons with disabilities.

"The county recruited 116 employees during the year. However, no persons living with disability were recruited yet the numbers are below the minimum required threshold contrary to the provisions of part B.23(2) of the Human Resource Policies and Procedures Manual for the Public Service, 2016 which set a threshold of 5 per cent of positions to be filled by persons with disability," Gathungu noted in her report.

Kilifi County was among those flagged for questionable spending, with over Sh70 million used to purchase office furniture and equipment.

However, an audit inspection found several irregularities, including a 55-inch television worth Sh151,450 that was non-functional and office chairs that had not been issued.

Additionally, a CT scan machine, fully paid for at Sh75.9 million, had not been delivered months after payment.

The report highlighted that such advance payments violate procurement laws, which prohibit payment before goods or services are received.

Foreign trips, inflated travel allowances

Counties continue to spend millions on foreign travel, with little accountability on the value of such trips. Tana River County, for instance, spent Sh6.4 million on allowances for staff attending a trade and education conference in the United States.

However, the audit found that there were no invitation letters, back-to-office reports, or any proof of participation.

The report also questioned why a local economic block event was held abroad when there were enough venues within Kenya.

Marsabit County spent Sh3.4 million on travel, daily subsistence allowances, and air tickets for three county officials who travelled to the UK to receive three donated ambulances.

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However, by the time of the audit in September 2024, only one ambulance had arrived.

In Nandi County, officials spent Sh1.7 million to attend a Black Caucus event in the USA, despite a government directive suspending non-essential travel.

Further scrutiny of travel expenses revealed that a state officer received Sh1.3 million to attend a conference in New York for 14 days, even though official guidelines allow a maximum of seven days for such trips.

Unfinished Projects

Siaya County was flagged for stalled projects worth millions. An X-ray machine installed at Got Agulu Sub-County Hospital remained unused due to a lack of a radiographer.

The report also cited delays in the construction of a perimeter wall at Migwena Sports Cultural Centre, despite the county already entering into a Sh33.8 million contract for the project.

In Wajir, the county government spent Sh9.3 million on repairing a generator, an amount that the Auditor General noted was enough to purchase a new one.

Busia County spent Sh5.8 million on a refrigerated truck, but the vehicle later broke down and was abandoned in a dilapidated state.

The county was later ordered to pay an additional Sh3.6 million in interest and legal fees after delaying payment to the vendor.

Nairobi County's Dishi na County school feeding programme was also flagged over alleged irregular payments to the implementing company.

According to the report, the county executive had agreed to pay Sh25 per plate for school meals.

However, it was discovered that the implementer charged Sh30 per plate, instead of the agreed rate, raising concerns about possible financial mismanagement.

In other counties, procurement irregularities were also widespread. Uasin Gishu County's ICT department procured a Samsung S23 Ultra mobile phone and a MacBook laptop for Sh430,000. However, during physical verification, only the phone was available for inspection.

Samburu County spent Sh2.9 million on mobile phones and laptops, but there were no records of who received them. This violated the Public Finance Management Act, which requires clear documentation of asset distribution.