• City Hall under flak over stalled projects despite Sh593 million paid to contractors
• Audit exposes blatant extravagance and waste of public resources
Governor Mike Sonko’s promise to rid Nairobi of graft has been put to test in an audit query exposing massive irregularities in the county’s accounts.
The City administration, according to Auditor General Edward Ouko, could not provide documents to support expenditures running to nearly Sh20 billion.
The auditor says taxpayers may have lost money in unexplained cash withdrawals, payments to contractors, unbanked cheques and staff.
The 2017-18 financial year report exposes blatant extravagance and waste of public resources.
Ouko flags an unaccounted Sh209 million in cash withdrawals from a KCB account in respect of an officer.
The Sonko administration is also on the spot over irregular payment of suppliers with Sh381 million and also for an undisclosed bank balance of Sh3 billion.
The audit exposes an irregular withdrawal of Sh6 billion from the county’s revenue account. "It was, therefore, not possible to confirm the accuracy of Sh10.1 billion county own-generated receipts."
The report, tabled in the Senate, further reveals an unexplained cash receipt of Sh5.3 billion.
The auditor questions the value for money in the Nairobi beautification project. City Hall did not provide any record on the cost of cement, seedlings, PVC pipes, cedar poles among other materials.
“An inspection revealed that the project was going on but indications that there were no specialists in landscaping did not assure the success of the project,” Ouko says.
He warns of loss of revenue from four social halls in Kariobangi and Dandora whose income was spent at the source.
He cites revenue loss in expired lease agreements for parks and open spaces, Uhuru Park boating services, Jukwaa Lounge, and Safari Bowling Green Restaurant.
An unsupported payment of Sh9 million to revenue account and irregular payment of Sh153 million to a revenue collector – Jambo Pay - are also been queried.
Ouko questions why the City Liquor Licensing Board has failed to prepare financial statements for two consecutive years.
The audit has also flagged an unsustainable wage bill after workers gobbled up Sh12.9 billion in salaries. This is 49 per cent of total revenue and way above the 35 per cent limit.
Also queried is the Sh12 million in casual workers’ wage bill compared to Sh8.4 million spent in 2016/17.
The county operates without an authorised staff establishment, casting doubts on how the budgetary allocations for personnel costs are determined.
The audit warns of the possible loss of funds through unsupported payment vouchers totalling Sh865 million and missing vouchers totalling Sh2.4 billion.
The administration is blamed for stalled projects on which Sh593 million was spent . “Consequently, it was not possible to ascertain that value for money has been realised in contracts for the eight abandoned projects,” the auditor says.
Also unexplained is Sh30 million expenditure on a public transport facility at Mama Lucy hospital and Sh26 million paid to a contractor for a market in Maringo.
The county lost Sh1.4 million in stale cheques between July 2016 and August 2017. No explanation was given.
The audit exposes Sh561 million in unsupported expenditure in respect of assets acquisition in the financial year under review.
The administration was also found in breach of the law after allocating only Sh1.4 billion, being six per cent of the total expenditure, for development.
An inspection of road projects executed by the county showed that some contractors were paid for shoddy work.
A road in Tassia, for instance, was found to be potholed. Also flagged was wastage of bitumen bought at Sh12.9 million which was rendered obsolete after being stored for more than six months.
The report questions Sh9.2 million spent on ignitors. Staff medical insurance cover is also queried. “I have not been able to obtain sufficient appropriate audit evidence to provide a basis for an audit opinion on these financial statements,” the auditor said.