The county government is on the spot over the whereabouts of Sh54 million disbursed from one of the three funds operated by the devolved unit just before the August 9, 2022 General Election.
The money was reportedly withdrawn from the County Consolidated Revolving Fund and wired to various groups without loan agreements or security.
The administrator of the fund at the time, Mr Joseph Kamau, has since been transferred to the Department of Social Services.
The revelations emerged yesterday during a Senate County Public Investments and Special Funds Committee hearing on the financial statements for three county funds for the financial years between 2020 and 2022.
Under the spotlight are the County Alcoholic Control Fund, the County Elimu Fund and the County Consolidated Revolving Fund. Committee chairperson Godfrey Osotsi asked Governor Abdullswamad Nassir to explain how the loans were disbursed and provide the list of borrowers.
“What are you doing to recover the money?” the Vihiga senator asked, pointing out that “We have witnessed similar cases in Kitui and Trans Nzoia counties”.
“Sh54 million has disappeared, and someone has to be responsible for it. Publish all the names of the beneficiaries and send a debt collector to recover the money,” Narok Senator Ledama Olekina added. Nominated Senator Tabitha Mutinda questioned why the money was loaned to the groups just before the elections.
“Was this money being siphoned for campaigns or what was it for? A similar thing was also witnessed in Kitui County,” said Ms Mutinda.
Mr Nassir acknowledged that it would be difficult to recover the money unless a financial institution is roped in to help the county track the borrowers. The fund, he said, had turned into a “sinkhole”.
“This fund is as good as dead. We are working on a new legislation that is going to repeal it. We have taken into account all the issues raised and the new regulations should be in place by June this year,” said the governor.
He was responding to a question by Mombasa Senator Mohamed Faki who wanted to know whether the county government has engaged a debt collector to try to recover the money.
Senator Olekina, however, argued that winding up the fund and setting up another was not the way to go as there was no guarantee that the new one would be devoid of the same challenges.
The Controller of Budget had fingered the Mombasa County Government for repeatedly failing to submit full reports and financial statements on its funds every quarter.
The county government was also on the spot for not coming up with legislation to regulate the County Alcoholics Drinks Control Fund and irregular remittances to the County Revenue Fund. The Elimu Fund also faced similar queries as well as lack of a provision for winding it up.
