Earlier this year when the Auditor General released audit reports for all 47 counties for the financial year 2017/18, something was different this time round. Makueni and Nyandarua county executives both received unqualified opinions, which loosely translates to a clean bill of health. Until this year, counties had been unable for one reason or the other, to properly maintain their financial books. As a result of this, none of the counties had ever received an unqualified opinion since their establishment in 2013.
The reasons behind qualification of most audit reports vary. Some are related to capacity, or systemic weaknesses, while others are blatant attempts at violating the very elaborate regulations governing public finance management. When the counties first came, most of them did not have in place audit committees or functional internal audit departments, whose principal mandate is advising the county administration on the prudent application of public resources internally, ahead of the constitutional audit undertaken by the Auditor General as enshrined in Article 229. Admittedly, most counties have since improved over the years, with a good number of them establishing audit committees and internal audit departments. However, the perennial issue related to illegal allowances continues to drag counties away from the gains made so far. Over time, reports on illegal allowances paid to Members of County Assemblies continue to feature prominently as some of the biggest audit issues related to counties.
All is not well at national and county levels
At the national level, the picture is not any different. A cursory look at the audit reports for the national government paints an even grimmer picture. For instance, ministries and government agencies are reportedly unable to account for over 160 billion cumulatively since 2010. Specifically, the Ministry of Health could not account for over 28 billion. Assuming that this money is lost, the opportunity forgone would be enough to purchase cancer equipment (theatre, central renal, ICU and radiology equipment) for two hospitals in every county for all the 47 Counties in Kenya, under the MESP (Managed Equipment Services Programme) whose total cost is 43 billion aimed to improve 97 hospitals in all these counties. On the other hand, the Ministry of Education (MoE), as of the most recently available audit report, could not account for 19 billion since 2010. While queries don’t necessary mean that money is actually lost, the figures we are dealing with here are stupendous. The unaccounted resources by the MoE for instance, would be enough to pay tuition fees for 800,000 secondary students in Kenya, at KES 22,244 per student in a financial year.
The Controller of Budget on the other hand, has pointed fingers at the National government’s ministries and departments, for over-expenditure on recurrent expenditure affecting development funds, and non-disclosure of AiA (Appropriations in Aid) in their IFMIS generated reports. As with counties, delays in submission of financial statements has continuously been a major problem over the last six years. This has continued to affect the timeliness of the release of audit reports, inadvertently affecting the quality of action on them by the media and other key actors.
Article 229 of our Constitution established the independent office of the Auditor General with the primary mandate to audit all public entities at both levels of government. These include the three arms of government, constitutional commissions and independent offices, public debt and political parties that receive public funds. By law, the Auditor General is required to audit and submit a report to Parliament within six months after the end of a financial year. Three months after this, Parliament and County Assemblies respectively must debate these reports and take appropriate action on anyone implicated therein, for further action by other mandated agencies such as the EACC, Directorate of Criminal Investigations, and the Office of the Director of Public Prosecutions.
The reports by the Auditor General are not personal opinions. These are statements of fact, with an aim of verifying an entity’s financial statements in order to ascertain whether public resources have been applied lawfully and effectively in respect to that financial year.
We are falling back on the fight against Graft
Recently, Kenyans have arguably witnessed a reinvigorated rhetoric against corruption coming from the Presidency and substantively driven by the Director of Public Prosecutions and the Director of Criminal Investigation. While Kenyans appreciate the revived onslaught, they now want, more than ever before, to see this war bearing fruit. This includes the successful incarceration of the high and mighty, who have previously managed to beat the judicial system. And this is where the reports from the Auditor General come in.
Unfortunately, the level of action by Parliament and investigative bodies on audit reports over the years has been wanting. Respective Parliamentary/County Assembly committees rarely debate these findings, and when they do, their role merely appears as a sanitizer for offenders. As Kenyans, we are now demanding to see a lot more action with regards to the enforcement of existing sanctions for the misdemeanors on our public audit regime. And these include debarment, proscribing fines, surcharging and withholding funds from the institutions and individuals responsible, in line with Article 225.
The effective use of the reports from the Auditor General and the Controller of Budget are the missing bullets in the fight against corruption. In utilizing them, the relevant agencies will effectively deal with the current perception amongst certain quarters that the onslaught against Corruption is merely a currency for political expediency, or to shape political formations ahead of the 2022 general election.
(This story was firs published on Mediamax )