An assessment of the records of the County Assembly of Kisumu by the Auditor General has revealed that the Assembly’s expenditure for the 2013/2014 financial year was characterized by anomalies.
According to a recent report of his office, officers did not follow the due process of law in conducting government business in all the seven key expenditure issues that were assessed.
“During the evaluation of internal controls of the County Assembly with regard to its expenditures, it was found that the set control procedures like budgetary controls, reallocation of funds, procurement plans, and maintenance of procurement records and posting of all payment vouchers in the vote books were not consistently followed by responsible officers,”
so says the Auditor General in the report.
First, the Assembly spent sh42 million
“between November 2013 and June 2014 to cater for rent, salaries and ward office maintenance to all its elected Members.”
The amount was spent as cash float to all its elected 35 members (MCA’s) and was credited to their personal accounts, says the report.
“the Assembly did not provide any supporting documents to account for the cash float paid and it was not clear how the funds were spent by the Assembly members.”
But perhaps the mega unexplained issue is that of the awarding of a tender for the construction of an ultra-modern chamber at the County at the cost of sh745 million. Although the Assembly is said to have followed the right procedure in the advertisement of the tender the Auditor General questions how it was ultimately awarded.
During the above process 12 contractors are said to have applied for the tender, a pool from which 8 of them were invited to present proposals.
“However, it was noted that a consultant was awarded the contract at contract value of 3.99 percent of the contract sum of the proposed building in accordance with the Ministry of Public works (condition of engagement and scales of fees) without inviting all the other firms to submit their proposals,” the report says.
“In the circumstances, the validity and appropriateness of the contract could not be confirmed,” it adds.
The Auditor General report revealed that even after the Assembly entered into a contract with the contractor it had not handed over the site “months into the financial year.” But it notes that the Governor at one time wrote a letter to the Speaker of the Assembly
“advising suspension of the proposed procurement of the contract for the Assembly building due to significant procurement anomalies arising from lack of capacity and possible impropriety.”
“Under the circumstances, the validity and appropriateness of the procurement process and the resultant contract could not be confirmed,” the report says.
It will be noted that the MCA’s have since opposed this plan advising that the money for the construction of the new Assembly be channeled towards development projects.
That is not all. The Assembly also committed a number of anomalies in the issuance of car and mortgage loans to its members totaling to sh250 million.
To start with the above loans were advanced “without application forms from individual members.” Secondly due diligence was not taken to advise the members on their repayment schedules in respect of what the law says.
“Review of the pay-slips and other related records revealed that members loan recovery put some members in pecuniary embarrassment as the recovery resulted to members earning below a third of their basic pay contrary to (what the law stipulates in regard to) the amount an employer is allowed to deduct from an employee wages.”
The Auditor General says no security was given for the above loans.
“No recourse was made available to the County Assembly in case of a default to pay the loan since the loans appeared to have been unsecured and the cars and lands were not jointly registered in the name of the Assembly and the respective MCA’s.”
The Auditor General also reveals that the expenditure of more than sh5.5 million on procurement of air tickets could not be ascertained. He also queries the use of close to sh0.5 million for the procurement of movable toilets for the members for two months in October and November 2013.
“It was not clear and no justification was given as to why the Assembly sourced for the services while toilet facilities are within the precincts of the Assembly.”
Other issues that have been queried by the Auditor include the payment of mobilization services to MCA’s totaling sh3.5 million and foreign and local travels costing more than sh50 million.
“No evidence was produced to ascertain the need or reasons for the travels as a justification for the expenditure and whether it was beneficial to the County Assembly and the general public,” he says.
“The County Assembly of Kisumu should in future adhere to budgetary controls and financial regulations,”
reads part of his recommendations to the lake region law making house.