National Assembly Committee on Finance and National Planning Chairperson Kuria Kimani.
A parliamentary committee kicked out the Equalisation Fund board after MPs raised concerns over the misuse of billions of shillings meant for provision of water, roads, health facilities and electricity in marginalised areas.
The National Assembly’s Finance and National Planning committee accused the board of overstepping its constitutional mandate by financing projects that are outside its scope.
The committee chaired by Molo MP Kuria Kimani accused the Fund of financing projects such as laying of cabro’s, street lighting, staff housing and kitchen renovations instead of provision of basic services as enshrined in the Constitution.
The lawmakers wondered why the fund had decided to finance projects like construction of classrooms that are handled by the National Government Constituencies Development Fund (NG-CDF) and also duplicate county governments functions.
Mr Kimani was forced to adjourn the meeting with the board chairman Mahboub Mohammed and chief executive Guyo Boru after it emerged that the data submitted on the fund’s projects were inconsistent with the reality on the ground.
"Looking at projects done, they are spread too thin and are outside the mandate of the Fund. One is left but wonder whether this fund really helps," Mr Kimani said.
"If you continue to do all manner of projects from installation of cabros to staff houses, will it serve the purpose for which the Equalisation Fund was established,” Mr Kimani asked.
The Equalisation Fund is meant to bring the quality of basic services in marginalised areas to the level generally enjoyed by the rest of the nation.
Article 203 establishes an Equalisation Fund which is meant to finance short-term projects that address food insecurity, health, water, sanitation as well as electricity and energy needs.
The Equalisation Fund, which aims to uplift the living standards of people in poor areas, is supposed to be an equivalent of 0.5 per cent of the latest audited annual government revenue as approved by Parliament.
The committee poked holes on a number of projects out of the ongoing 310 projects pointing out glaring inconsistencies in their implementation status.
Mr Kimani singled out a number o0f irrigation schemes where in one instance a five-acre scheme cost Sh2.6 million while ten acres was allocated Sh3.6 million for construction in the same locality.
“There are some irrigation projects like construction of a staff house at Chalaluma dispensary in Witu, Lamu at a cost of Sh6.2 million. If projects are this arbitrary, how can we ensure value for money?” Mr Kimani asked.
"The projects are so diverse that even if you allocate the fund for 10 years, it will never make sense.”
Mr Kimani also sought to know how the Fund said a bridge project was only two percent complete in Turkana South constituency when the area MP Ariko Namoit, who is the vice chairperson of the committee says it was 40 percent complete.
“This board is presenting misleading reports that casts doubt on the accuracy of its project data,” Dr Ariko said.
“The information presented to the committee is wrong in the first place. This board has ignored the law and is implementing projects that were not envisioned.”
Kitui Rural MP David Mboni demanded to know why the fund was implementing projects that can be managed by NG-CDF and some outside its mandate.
"The board and Commission on Revenue Allocation (CRA) have diluted the objective of this fund. It was to address the inequalities in Sessional Paper No10 of 1965,” Mr Mboni said.
The board said its role is to allocate funds to projects as determined by the CRA and the implementing agencies were entities within the national and county governments.
Engineer Mohamed said the board has financed all projects as identified by the CRA and blamed county governments for any failures in the implementation of the same.
“The Equalisation Fund has no role in identifying beneficiaries and needs of a region. This is done by the CRA,” Mr Mohamed said.
"The unpredictable movement of funds has resulted in many audit queries. We have people queuing for pending bills," Engineer Mohamed said.
Engineer Mohamed told the committee that the total entitlement to the Equalisation Fund from the Treasury stood at Sh80 billion as at the end of June 2025.
However, Engineer Mohamed said the Treasury had only appropriated Sh39.89 billion to the Equalisation Fund out of which Sh15 billion had been released to the Fund.
