How ministries misused Sh6.5 billion from emergency fund within six months
Audit report indicates that review of the respective returns revealed that the funds were disbursed for urgent and unforeseen expenditure
Over Ksh 1 billion withdrawn from the Contingencies/Emergency Fund, the government kitty set aside for urgent and unforeseen situations, in the second half of the 2023/24 fiscal year could not be accounted for.
According to Auditor General Nancy Gathungu, expense returns with details of payments made from the advances in respect of ministry of Defence (Ksh 500,000), ministry of Interior & National Administration (Ksh 500,000) and State Department for Irrigation Ksh 70 million), all totaling Ksh 1,070,000,000 were not provided for audit as required by the Public Finance Management Act (PFMA). This, therefore, means the utilisation of the funds was not full-proof.
In her report, Gathungu also says there were gaps in utility especially on advance to Ministries, Departments and Agencies (MDAs) of Ksh 6,529,762,811 during the review period.
The amount included Ksh 30 million disbursed to the State Department for Public Works, a total Ksh 65 million for the State Department for Crop Development, Ksh 35 million for State Department of Livestock for an accrued total of Ksh 130 million.
The audit report indicates that review of the respective expenditure returns provided revealed that the funds were disbursed was in respect to goods and services that could not meet the threshold prescribed under Section 21 of the PMA Act 2012 which explicitly provides that advances may be made from the Fund if only the Cabinet Secretary (National Treasury) is convinced and satisfied that an urgent and unforeseen need for expenditure has arisen minus express legislative authority.
Additionally, the advances as seen in the report include Ksh 3,829,762,811 advanced to the State Department of Arid & Semi-Arid Lands (ASALs) and Regional Development.
However, the audit indicated that the expenditure returns provided revealed that the funds were disbursed from December 2023 to June 2024 and the direct expense was paid out from the funds until mid June 2024 with no explanation provided to justify the funding of the expenditure from the Contingency Fund.
This even as the State Department had included programs in the subsequent supplementary budget in the year of review.
The report, therefore, concludes that the propriety of the expenditure could not be confirmed given the circumstances.
As such, in terms of effectiveness of internal controls, risk management and governance, there were no material issues relating to effectiveness of internal controls. As for report on lawfulness and effectiveness in use of public resources, there were no material relating to the same.
