Taxpayers' money sunk into incomplete projects, Auditor General report shows

Billions of shillings in public funds are stuck in incomplete government projects across the country, raising serious concerns over wasteful spending and a lack of accountability.

A recent audit by the Auditor General has exposed numerous stalled developments, showing that taxpayers are losing money on projects that remain unfinished long after their scheduled completion dates.

In the 2024 financial year alone, government ministries and departments spent at least Sh7.6 billion on projects that have not been completed.

Despite the heavy investment, many of these initiatives have yielded no public benefit, and their continued delays are contributing to rising costs and further strain on national resources.

Auditor General Nancy Gathungu said the affected projects are contributing to poor use of development funds and have become a financial burden on the public.

“The amount spent is a sunk cost, as no development has been achieved from the stalled or incomplete projects. The costs incurred further distort expenditures incurred on development votes,” Gathungu warned in her report.

The Ministry of Defence has the largest amount tied up in stalled works, with Sh3.1 billion already spent on infrastructure projects that remain incomplete.

The money, which could have been used to provide essential public services, is instead locked in unfinished construction sites.

In the health sector, the State Department for Medical Services has spent Sh1.4 billion on stalled projects, including a Paediatric Emergency Centre and a Burns Management Unit.

These two projects, which cost Sh1.1 billion, are still incomplete, while a proposed Kisii Cancer Centre that was allocated Sh283 million has yet to take off.

In addition, Sh32 million was paid to a contractor for a medical gas plant, but the equipment has not been delivered.

Gathungu also flagged 16 equalisation fund projects across various regions that have stalled and whose value remains unconfirmed.

According to the audit, many of these projects have not provided any public service since they were launched.

“There is no value for money on public funds spent on the stalled and delayed projects, as no services are being provided by these projects,” she stated.

The delays affect even smaller-scale initiatives.

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Not operational

The State Department for Labour spent Sh244 million on a National Employment Promotion Centre, but the project is still not operational. Similarly, Sh95 million was lost in a stalled Occupational Safety and Health Institute.

Other key government departments are also named in the report. The State Department for Public Works failed to complete headquarters for Tharaka Nithi, Nyandarua, Isiolo and Tana River counties, despite spending Sh2 billion on the buildings.

The Housing Department has been faulted for spending Sh5.2 million on markets in Kasarani and Gigiri, which do not exist.

The Teachers Service Commission allocated Sh122 million for new offices in Kilifi and Machakos, but the money was never used, and the offices were never built.

Some of the delayed projects have led to financial penalties due to late payments for completed work. Others have had their costs revised upward, far beyond the initial contract amounts, worsening the financial impact.

“Payments have been made to projects which appear to have completely stalled, casting doubt on value for money for such expenditure,” said Gathungu.

Among other stalled ventures highlighted in the audit is the parliamentary studies centre, which has already consumed Sh934 million, yet it remains incomplete. Similar concerns were raised about the science and technology parks being developed at Dedan Kimathi University, which are still under construction years after their planned delivery.

The Public Service Commission was also flagged for spending Sh67 million on a management system that is yet to be completed. In the same report, the Housing department was once again mentioned for wasting Sh5.2 million on the unbuilt markets in Nairobi’s Kasarani and Gigiri areas.

The stalled Africities Convention Centre project in Kisumu County was among the high-profile initiatives highlighted in the report. The Internal Security Department is also under scrutiny for spending Sh833 million on incomplete projects.

The audit has painted a troubling picture of poor planning, lax oversight, and disregard for public funds, with stalled and delayed projects affecting key sectors of service delivery.