Procurement of pharmaceuticals and legal services have become some of the notorious avenues for governors to plunder billions of taxpayers’ money in the counties, the latest audit report has revealed.
From wanton plunder of public funds and cases of unethical practices, the report for the financial year ending June 30, 2024 has detailed how some counties have spent taxpayers’ money in total violation of procurement laws.
In Wajir, Governor Ahmed Abdullahi’s administration is on the spot over Sh156 million for the supply and delivery of medical drugs to various facilities within the county.
Review of payment records revealed that the amount was paid to Kenya Medical Supplies Authority (Kemsa), with Sh97.7 million for supply of drugs to dispensaries and health centres not being supported by way of store records. The county also spent Sh9 million in repair of a generator, an amount the report indicates is enough to buy a new one.
“The management did not provide justification for the expenditure, which was estimated as enough to purchase a new generator, raising concerns of the potential excess and wasteful expenditure,” states the report.
The report further questions a Sh18 million expenditure on procurement of laptops and printers. According to the report, the county spent Sh57 million to purchase office furniture and general equipment. Review of delivery records revealed that Sh40 million was incurred on supply and delivery of ICT equipment including laptops and printers.
“However, delivery notes worth Sh19 million did not include serial numbers for the equipment acquired hence, it was not possible to confirm existence of the items supplied,”
In Mandera, Governor Mohamed Khalif’s administration could not account for Sh148 million incurred in purchase of drugs.
The county made payments of over Sh765 million for specialised materials and services, out of which an amount of Sh148,365,078 was for pharmaceutical drugs, non-pharmaceuticals, dressings and lap reagents from Kemsa.
The expenditure was, however, not supported by way of requisitions from the county health facilities, inspection and acceptance committee report.
Further, the report reveals that the county executive entered into a contract for provision of consultancy services for preparation of valuation roll for Mandera and Elwak Municipalities at a contract sum of Sh54 million on April 15, 2024.
A total of Sh5 million representing nine percent of the contract sum was paid to the consultant. The payment was, however, not supported with a report of the contract implementation team as required by section 151 (1) of the Public Procurement and Asset Disposal.
The county also incurred Sh45.5 million on provision of legal services, but there was no written approval by the County Executive Committee and a request to engage for the services by the respective departments.
In Marsabit, the County Public Service Board procured legal services from a law firm to defend a civil case in court where the plaintiff sued for a Sh1 million in damages from unlawful detention of a motor vehicle.
There was, however, no evidence of the application of the Advocates Remuneration Order for determining legal fees. A fee of Sh3.3 million was charged, an amount higher than the claimed damages of Sh1 million.
The county under Governor Mohamud lost the case and was ordered by the court to pay the damages together with the suit cost. This resulted in an expenditure of Sh4.3 million, leading to potential loss of public funds. The county is also on the spot for splashing millions of shillings on insurance cover for grounded vehicles.
Further, insurance records revealed that 52 motor vehicles valued at Sh134 million were included in the county executive’s list of insured vehicles.
Review of the vehicles revealed that they were either grounded or unserviceable during the insured period.
“Despite this, the county executive irregularly paid a premium amount of Sh4.1 million. In addition, the list of the insured vehicles included six motor vehicles bearing duplicate registration numbers, valued at Sh18.6 million. The vehicles were insured as separate assets, resulting in an irregular double insurance premium of Sh558,000.”
In Garissa, Governor Nathif Jama’s administration is on the spot over unsupported locum payments, with the audit report indicating that it incurred Sh37.8 million in payments to 114 medical staff.
The report shows that there was no evidence of requisitions from the user department, appointment approval and posting by the county public service. There was also no explanation on their roles, terms of engagement and remuneration.
The county is also on the spot over unaccounted pharmaceutical supplies. It reveals that the department of health procured drugs from a local supplier worth Sh26 million.
However, management did not provide records to support the procurement process for acquisition of the drugs.
“Requisitions from user departments, delivery schedules, counter receipt vouchers (S13), store ledgers and issues from the stores were not supported by the counter requisition and issue voucher (S11) forms. In addition, payments for the pharmaceuticals supplies were not supported by the inspection and acceptance committee,” the audit reveals.
In Mombasa, the audit revealed instances where money was used for domestic travel and subsistence but there were no documents to support such expenditure.
“The statement of receipt and payments and note 4 to the financial statements reflect use of goods and services amount of Sh1.2 billion which include domestic and subsistence amount of Sh147.8 million.
However, payments under the departments of Public Service Board, Education, and Finance and Economic Planning amounting to Sh4.15 million, Sh2.24 million and Sh10.6 million respectively were not supported with attendance schedules, back to office reports on benchmarking and acknowledgment of money received.”
The report has also questioned unexplained voided transactions where analysis of Ifmis internet banking report revealed that the county executive voided a total of Sh921 million invoices which had been uploaded for payment.
“Included in the expenditure is an amount of Sh413 million being payment requests towards suppliers and statutory deductions which were later voided. However, the voided payment vouchers, requests to void payments, the National Treasury approval and the exchequer requisitions from the Controller of Budget were not provided for audit review,” states the report.
Further, expenditure amounting to Sh53 million on consultancy services for design, development and implementation of automated revenue generation and management system and county institutional ICT integration was erroneously charged under specialized materials while it related to prior year invoices which should have been charged under other payments.
In Migori, Governor Ochillo Ayacko’s administration was on the spot for irregular hiring of temporary staff. The basic wages for the temporary employees amounted to Sh141.2 million, even though letters of their appointments could not be provided.
In addition, the statement of receipts and payments reflects other grants and transfers of Sh292.4 million, which includes scholarships, and other educational benefits of Sh23.1million that relates to the Inua Elimu scholarship programme. There were, however, no regulations and scholarship policies used in identifying the beneficiaries.
Further, the report shows that the County Executive entered into a contract with a firm for the rehabilitation of Kaknene dam in God Jope Ward at a contract sum of Sh6.9 million.
It was one of the projects implemented under the Financing Locally-Led Climate Action (FLLoCA) program. The contract entailed rehabilitation of the dam, repair of embankment and spillway among others.
A review of the Integrated Payroll and Personnel Database (IPPD) records for the month of June 2024, revealed that job designation for 44 officers was not defined in the database.
A further review of the internal controls over payment of the salary arrears amount of Sh46.09 million revealed that the tabulation, verification and payment authorizations were done by a single officer due to the inadequacy of staff at the payroll section.
In Siaya, Governor James Orengo’s administration is on the spot for paying staff salaries outside the IPPD.
A review of the payroll records revealed that the County Executive engaged the services of 2,128 community health workers and spent Sh76.6million on wages in the year. Each of the health workers was paid Sh3,000 per month. However, the records on how the workers were recruited were not provided for audit.
Further, a review of the IPPD records revealed that 192 staff were paid Sh3.1million as special allowances.
The management explained that some of the staff members were employed as revenue collectors at a monthly salary of Sh14,675 for a contract period of three years, but there was no documentary evidence to show the recruitment process.
The devolved unit also made salary payments amounting to Sh14.5million to 240 staff in the month of June outside the IPPD through vouchers. The management attributed the payments to funeral expenses, baggage allowances and unremitted gratuity.
The audit has also flagged irregular variation of the stadium's project cost from Sh394.6 million to Sh488.7 million, resulting in a contract variation price of Sh94million.
The report shows that there was no evidence of recommendation by an Evaluation Committee for the variations contrary to section 139 (1) and (2) of the Public Procurement and Asset Disposal Act.
The audit further reveals that a Sh4 million was paid to an advocate in a civil case between the County Public Service Board and former employees. The amount paid was not supported by any evidence of court attendance and individual itemized billing to inform charges shown in the fee notes of the Advocates Remuneration Order 2014.
