Disregard for procurement laws hampering devolution

What you need to know:

  • Some counties pay millions of shillings in advance for goods and services not delivered.
  • Many governors do single sourcing, specifically to award tenders to pre-determined companies.

Senators have expressed concern that deliberate flouting of procurement laws and processes is a threat to devolution.

This follows revelations that public servants are reluctant to guide their bosses on matters touching on their areas of expertise.

Those working in the finance, procurement and internal audit departments are the most affected, as governors give directives on who gets what tender and how agreed amounts should be released to the identified beneficiaries.

According to the Auditor-General’s Financial Operations of County Governments Report, 2014, failure to comply with set financial regulations as set out in the Public Finance Management Act has led to massive loss of taxpayer funds.

Some counties pay millions of shillings in advance for goods and services not delivered while others prefer to give contracts to certain firms when the law requires that the tenders be subjected to competitive bidding.

What is more, many governors do single sourcing, specifically to award tenders to pre-determined companies.

Further, some counties approve money to be spent on non-essential projects as key development projects remain ignored, while others are collecting less revenue compared to what former local governments used to collect.

The Controller of Budget and the Salaries and Remuneration Commission (SRC) have warned that uncontrolled expenditure is hurting county development projects and, by extension, devolution.

But some governors have ignored the minimum and maximum salary scales set by the SRC in a bid to tame the rising wage bill, and many are increasing spending on salaries and allowances, leaving little for development projects.

The anomalies have seen governors appear before the Senate Public Accounts and Investment Committee more than once to respond to the audit queries.

Governors Jackson Mandago (Uasin Gishu), Alex Tolgos (Elgeyo-Marakwet), Jack Ranguma (Kisumu), Salim Mvurya (Kwale) and Nadhif Jama (Garissa) have appeared before the committee.

FLOUTED THE LAW

Although Mr Mandago appeared before the committee for the third time last Thursday, he was asked to return on November 13 with additional evidence after he failed to account for Sh37.9 million.

“This is a weighty issue that needs a satisfactory answer. Matters of accountability are too important to be swept under the carpet. We want concrete evidence to satisfy the audit queries,” said Senator Kimani Wamatangi (Kiambu, TNA), who chaired the session.

The governor failed to account for some Sh34.4 million that was irregularly paid in advance to three firms to supply furniture, computer and hardware materials.

An additional Sh3.5 million was paid to a construction company to fence off a five-acre piece of land in Kapsoya long before the work was started.

“This amount was paid up front to companies that were not subjected to bidding. Are you aware that you were flouting the law?” Mr Wamatangi asked the governor who was accompanied by senior officials from the county.

The senators sought to know why the county opted to spend such an amount to fence off the land that was not under threat of grabbers as it was in use.

Mr Mandago said the fencing was necessary to deter would-be land grabbers.

“A number of public utilities have been grabbed; we needed to move fast and fence it off to discourage encroachment,” he said.

DISSATISFIED WITH EXPLANATION

Some 500 cases concerning land have been forwarded to the Ethics and Anti-Corruption Commission (EACC), the National Land Commission and the Ministry of Land for investigations.

The governor was also hard pressed to explain why some funds were deposited in a client’s fixed deposit account long before work was carried out.

They committee suspected foul play and was dissatisfied with the explanation that the county had an agreement with the bank to release the funds once the work was complete.

“This is money already in the client’s account accruing interest. It cannot be transferred without the authority of the account owner,” said Prof John Lonyangapuo (West Pokot, Kanu).

“Revelations that legal deductions to cater for various taxes before a client is paid his dues were done a year later raise genuine questions about the legality of this transaction,” he added.

Prof Lonyangapuo said there were a lot of illegal transactions going on in the counties because government officers who are supposed to advise the governors were being ignored.

Senator Mong’are Bw’okong’o (Nyamira, Ford-K) said devolution risks being derailed because of irregular utilisation of funds meant for recurrent and development expenditure in the counties.

The senator said the Senate cannot push for increased funds for the counties the use of money already disbursed is not prioritised for development.