Millions of shillings missing in Homa Bay, Auditor General report reveals
The Homa Bay County Assembly.
What you need to know:
- County government allegedly provided auditors with doctored records.
- MCAs had also spent Sh214.265 million on domestic travel.
Taxpayers in Homa Bay may have lost millions of shillings which the Office of the Auditor General suspects was misappropriated.
The funds were allegedly lost in both the executive and the County Assembly in the 2022-2023 financial year.
Officials from the devolved unit are reported to have spent the public funds but could not account for it.
In other areas, the county government allegedly provided auditors with doctored records or failed to provide supporting documents for the spending altogether.
At the County Assembly, Auditor General Nancy Gathungu, in her report said MCAs spent more than Sh5.3million on foreign travel.
However, the expenditure was not supported by copies of visas, air tickets, boarding passes, and back-to-office reports.
Further, the amount includes Sh2.262 million which was disbursed to seven MCAs as travel allowance while attending the Lake Victoria Region Local Authority Co-operation (LVRLAC) meeting at Mbarara City in Uganda from April 10, 2023, to April 15, 2023.
The audit report said documents such as invitations, programme of activity or agenda and signed attendance list were not provided to support the usage of funds.
MCAs had also spent Sh214.265 million on domestic travel.
“The amount includes Sh832,000 paid to sixteen MCAs as travel allowances to facilitate a report writing exercise in Kisumu for the Department of Lands, Housing, Physical Planning from October 31, 2022, to November 2, 2022,” read part of the report.
However, Ms Gathungu said the expenditure was not supported by the Speaker’s approval, program activity or agenda and attendance list.
“Further, no documentary evidence in support of tabling of the Lands, Housing, Physical Planning Committee report in the County Assembly. In the circumstances, the accuracy and utilization of funds amounting to Sh6.160 million could not be confirmed,” the report said.
Ms Gathungu further noted that the House, under the leadership of Julius Gay as the speaker and Kwabwai MCA Richard Ogindo as Majority leader spent Sh214.265 million to cater for a trip to Mombasa.
The amount includes Sh12 million paid to assembly staff, MCAs and Members of the County Assembly Service Board (MCASB) to enable them to attend an induction workshop in Mombasa.
The auditor general’s report said this was contrary to National Treasury, Circular No.20/2015 of November 2015, which requires all accounting officers to hold all workshops and retreats within the precincts of the duty station where most of the participants work.
“In the circumstances, value for money on the expenditure of Sh12,065,207 could not be confirmed, and management was in breach of the law,” the report said.
Other irregular expenditures by MCAs include hospitality supplies and services amounting to Sh29.780 million.
The funds include a Sh4.9 million expenditure incurred on a team-building exercise in Kisumu City.
Ms Gathungu said there was no value for money and the assembly breached the law for failing to hold the same activity locally.
Homa Bay County Assembly is also on the spot over stalled projects.
These include the construction of an automated gatehouse at Homa Bay County Assembly at a contract sum of Sh7 million and stalled construction of Homa Bay County Assembly Office Block at Sh348.927 million.
The Auditor General’s report indicated that some money had been paid to companies that were undertaking the construction projects.
In the first project, the audit revealed that the contractor had been paid Sh4 million as of June 30, 2022.
“An audit inspection of the project on November 22, 2023 revealed that windows and glazing, doors, internal finishes, external finishes, electrical installations and joinery fittings had not been completed. Further, the contractor was not on site,” the report read.
Meanwhile, construction of offices for MCAs which was supposed to be complete by January 8, 2021, but was later extended to April 8, 2022, has also stalled.
Ms Gathungu said a review of records revealed that the contractor had been paid a total of Sh66.714 million.
However, a physical inspection of the project on November 22, 2023, and a review of records with respect to the project revealed that the work on the project had not been completed over one year after the completion date.
“Further, the contractor was not on site and no work was ongoing at the site. In the circumstances, value for money on the construction could not be confirmed,” read part of the report.
At the executive, the auditor general said there were inconsistencies in documents provided during the audit.
The report said there was an inaccuracy of Transfers from the County Revenue Fund (CRF).
The statement of receipts and payments reflects transfers from CRF amounting to Sh8.294 million.
However, the County Revenue Fund financial statement reflects transfers to the County Executive and other transfers totalling Sh7.870 million and Sh419.462 million respectively resulting in an unreconciled variance of Sh4.233 million.
“In the circumstances, the accuracy and completeness of transfers from CRF amounting to Sh8.3 million could not be confirmed,” read the audit report.
The executive also transferred funds to other Government Entities amounting to Sh198.6 million.
The amount includes transfers to the Homa Bay Municipality Board totalling Sh3.5 million.
However, the Homa Bay Municipality financial statements reflect receipts from the County Executive amounting to Sh22.281 million resulting in an unreconciled variance of Sh18.781 million.
Ms Gathungu also said the executive spent Sh4.276 billion or fifty-two (52) per cent of the total revenue of Sh 8.3 billion to pay workers.
This was contrary to Regulations 25(1)(b) of the Public Finance Management (County Governments) Regulations, 2015 which states that the expenditure on wages and benefits should not exceed 35 per cent of the county government's total revenue.
Governor Gladys Wanga’s administration further spent Sh971.13 million for contracted professional services.
It includes Sh115.721 million for contracted professional services expenditure including subscription to the Council of Governors at Sh5.850 million.
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“This was contrary to Section 37 of the intergovernmental Relations Act, 2012 which states that the operational expenses in respect of the institution established in the Act shall be incurred by the National Government,” the auditor general said in the report.
Homa Bay county government also spent Sh2.950 million for environmental assessment consultancy for the Special Economic Zone in Riwa in Rachuonyo North.
Ms Gathungu however said the executive did not provide the environmental assessment report for audit.
Governor Wang’s administration further spent Sh38.886 million on legal fees to different law firms.
According to the audit, the money was paid to various law firms for representing the County Executive in various legal disputes/court cases during the year under review.
The report said a review of records revealed that there were 47 court cases against the County Executive.
“However, the details of the court cases including the subject matter, case files, fee notes and the financial implication such cases may have on the County Executive were not provided for audit. Further, all the forty-seven (47) court cases and matters were being handled by external law firms,” the report read.
It continued “No satisfactory explanation was given as to why the legal services were outsourced. In the circumstances, value for money may not be achieved from outsourced legal services amounting to Sh38.886 million,”
