Auditor General Nancy Gathungu has protested against proposed budget cuts of over Sh270 million, arguing that it would hamper the operations of her office, including the preparation of audit reports for national and county governments.
Appearing before the Budget and Appropriations Committee on Monday, Ms Gathungu appealed to the National Assembly to restore the slashed funds in the 2024/2025 budget to enable her office to carry out its mandate effectively.
"I appeal to Parliament to consider reinstating the money slashed from the budget to enable the Auditor General's office to continue delivering its constitutional mandate and ensure quality and timely audit reports for effective oversight," Gathungu told the committee chaired by Kiharu Member of Parliament Ndindi Nyoro.
Despite being a critical anchor in overseeing public fund usage, the OAG relies on annual allocations proposed by the National Treasury and approved by the National Assembly.
Gathungu has previously advocated for an overhaul of the funding system to enhance the OAG's independence, proposing a protected fund for the office, ring-fenced from arbitrary adjustments by Parliament and the National Treasury.
In the 2024 Budget Policy Statement, the Auditor General's office was allocated Sh8.6 billion, with Sh8.28 billion for recurrent expenditure and Sh315 million for development.
However, the proposed estimates reduced the recurrent budget to Sh8.21 billion.
She also highlighted the need for funds to construct a regional office in Mombasa, estimated to cost Sh900 million and planning for a new headquarters in Nairobi.
She requested an initial allocation of Sh500 million for the Nairobi headquarters, part of an estimated Sh6 billion project cost.
"We agreed to prioritise the Mombasa regional office, but it is also imperative we start preliminary planning for the headquarters. I would request an allocation of Sh500 million for the OAG headquarters project to enable us to commence the process," she said.
Nyoro questioned the return on investment for the Nairobi headquarters, noting that the annual rental expenditure is around Sh180 million, and it would take 30 years to recover the Sh6 billion investment at current market rates.
Nyoro pointed out that the construction of the headquarters was approved in 2014, but the project has faced delays, with costs escalating over time.
However, Gathungu said the delays have increased costs and ongoing lease expenses. She requested the reinstatement of funds for the Mombasa office and for the conversation about the Nairobi office to begin.
Several committee members supported prioritising the Mombasa regional office. Gathungu also welcomed the enhancement of personnel emoluments by Sh278 million but noted this is still Sh84.5 million short of the estimated requirement, affecting the planned recruitment of 150 audit associates, which would cost Sh123 million.
Committee member and Alego Usonga MP Samuel Atandi suggested investing more in technology to cut expenses, with the Auditor General saying her office is leveraging technology to produce timely audit reports and is progressively recruiting and outsourcing additional personnel.
The Auditor General also warned about the government's proposal to reduce the budget for flood mitigation by more than Sh3 billion, emphasising the need for funds to recover from flood damage estimated at over Sh80 billion.
She noted that inadequate allocation for flood mitigation and food security could signal potential issues with other competing priorities and an underestimation of risks.
