Auditor-General pivotal pillar in the fight against corruption

Wednesday December 13 2017

Auditor-General Auditor-General Edward Ouko.

Auditor-General Auditor-General Edward Ouko. PHOTO | JEFF ANGOTE | NATION MEDIA GROUP 

By ROBERT SHAW
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The Auditor–General’s Office holds a venerable position in Kenya and has been one of the most persistent pillars against corruption over the years.

Let us take the Report of the Controller and Auditor-General for the year 1990/91 and hone in on the Office of the Vice-President and Ministry of Finance:

“In October, 1990 a Nairobi company requested the Ministry of Finance for sole rights to export diamond jewellery and gold out of the country and also asked for a grant of 35 per cent export compensation on the items.”

The report continues dryly to question both the eligibility of such items for export compensation and why it should be 15 per cent over and above the then standard export compensation of 20 per cent. The latter got the nod when the Treasury “received the minister’s approval to pay the additional 15 per cent in export compensation as an ex-gratia payment to the company”.

CUSTOMS REFUND

By January 1992, the ministry had paid a total of Kenyan pounds 29,491,152-7-55 of the 20 per cent and the 15 per cent top-up.

The report continues: “Apart from the illegality of the payment of the additional 15 per cent compensation to the company for which there was no provision in law, the charging of the expenditure to a Customs Refund item of Vote R.7 is highly irregular.”

It then concludes by saying  that there is “no evidence” that was claimed to have been exported was actually processed in Kenya or that the import content did not exceed the 70 per cent as required by the Export Compensation Act.

PAYMENTS

In short it, questions the purported export, the eligibility of such an export if it was the case and thirdly the illegal top-up of 15 per cent.

The 1991/92 report confirms that payments of the 20 per cent continued, and as of March 1993, a grand total of Kenyan pounds 73,977,521-19-20 had been made to the company.

That, of course, was the Goldenberg mega scam. The Controller and Auditor, Mr D. N. Njoroge, and his office played the pivotal role in confirming the facts and figures.

The Goldenberg scam resulted in massive amounts of money being hosed into the money supply by the Central Bank of Kenya, which, in turn, caused massive disruption of the economy and falling standards of living.

It should be appreciated how important a role this independent office played in those days when access to information and the freedom of the media was much more limited.

AUTONOMY

What should be public information was less easily accessible and the media was subject to a considerable amount of self-censorship.

Unsurprisingly the Executive has tried to water down the independence and autonomy of this office over the years and, of course, attempt to rubbish it. But all in all it has survived such attempts and the current Auditor-General, Mr Edward Ouko, is doing a solid job.

One encouraging development is that these days it is easier to act on the relevant excesses and misdemeanours.

In his latest report, the Auditor-General pinpoints some almost comical irregularities and obvious fraud where a supplier was paid Sh267.9 million for 78,000 pairs of boots. But there is a question about how many boots were actually delivered and how many were fictitious since many police officers went without any.

MOTORBIKES

Chinese assembled motorbikes were bought at Sh210,000 each for the Kenya Police Service whilst the lowest bidder had offered them for around 23 per cent less. The overall total loss was Sh174.8 million.

This is an institution that is mandated to uphold law and order and yet some of its officers are ill equipped and others are riding around on overpriced motorbikes.

There is also the unaccounted for Sh8 billion swirling around the Ministry of Interior. Surely it cannot be explained away on the basis of national security!

If President Uhuru Kenyatta is going to walk the talk on his pledges for greater transparency and a purge on corruption then he should welcome the Auditor- General’s report.

This is where he can make a difference. He should see the report as an accomplice to combat corruption and utilize the facts and figures that it has come up with.   

That means getting the incoming Cabinet Secretaries to report back and show what they are doing about the irregularities that are highlighted in their respective ministries for starters.

Mr Shaw is and economic and public policy analyst:[email protected] Jaindi Kisero’s column to resume next week.