• Auditor General Nancy Gathungu flagged the expenditure, stating that the county had not supported the transfer of the entire Sh9.7 million to Helb.
• The committee established that the arrangement the county entered to with Helb to disburse loans to students from the county studying in various institution was irregular.
A Senate watchdog team last Thursday put Bomet Governor Hillary Barchok in a spot over irregular deal with the Higher Education Loans Board on disbursement of loans to students.
The Senate County Public Investments and Special Funds committee questioned why the county government irregularly signed the deal that involves millions of taxpayers’ money.
This was after the governor failed to explain the whereabouts of Sh2.24 million reportedly sent to Helb for disbursement to Bomet students under Bomet County Education Revolving Fund.
The amount was part of the Sh9.7 million the county reported releasing to Helb for disbursement. However, Helb only disbursed Sh7.57 million.
In addition, it emerged that the county signed a charter with Helb and has been channelling funds to the agency despite lacking an approved budget for the same.
“The committee directs the governor to ensure that the fund administrator submits to the committee, statements as evidence that the Sh2.24 million is still being held by Helb,” committee chairman Godfrey Osotsi said.
The governor appeared before the panel to explain the audit queries on Bomet County Bursary Fund and the Bomet County Education Revolving Fund.
In the report covering the period ending June 2022, Auditor General Nancy Gathungu flagged the expenditure, stating that the county had not supported the transfer of the entire Sh9.7 million to Helb.
“The statement of financial performance reflects transfers to Helb of Sh9.7 million. However, student list indicating name, admission/registration numbers and amount awarded to each student was not provided for audit,” the report states.
Further, the report states that the county risks losing millions in the arrangement as many beneficiaries were not repaying the loans.
“The statement of financial position reflects current portion of long term receivables from exchange transactions of Sh38.80 million."
It adds, “However, detailed schedule of showing the repayment dates and amount for all beneficiaries due within 12 months after the reporting date was not provided for audit.”
The governor, in his response, admitted the county had not provided all the supporting documents during the time of the audit as it had not received the schedules from Helb.
“However, all loan schedules disbursed during the financial year have been received and have been availed,” he said.
Barchok told the committee that Helb, which the county has a service charter with is the custodian of details of repayments and is fully in charge of recoveries.
The committee established that the arrangement the county entered to with Helb to disburse loans to students from the county studying in various institution was irregular.
“You must ensure that the legal framework governing the fund and made between county government of Bomet and Helb is regularised in line with section 12 of the HELB Act and Regulation 197 of the PFM (County Governments) Regulations, 2015,” Osotsi told the governor.
Concerning budget for the Fund, the auditor revealed that the budget for the vote was not captured in the county’s financial statements.
“The committee notes that Bomet County Education Revolving Fund and Bomet Bursary Fund did not have an approved budget,” Osotsi said.
“The committee directs the governor, through the county executive committee member in charge of finance, to ensure that the funds administrators prepare and submit a budget for approval in line with Regulation 29 of the PFM (County Governments) Regulations, 2015,” the chairman added.
The committee further directed the governor to ensure that the fund administrator puts in place a risk management policy in the law.
The auditor in her report indicated that the fund lacks risk management policy.
“Further, CECM in charge of finance to ensure that there are systems of internal control and measures taken to ensure that they are effective in line Regulation 22 of the PFM (County Government) Regulations, 2015,’ Osotsi said.
On the Bomet County Bursary Fund, the committee directed the governor to provide a schedule of disbursement of bursary funds within seven days.
This after the auditor’s report cast doubt on the expenditure of cash under the fund as the county did not provide a list of beneficiaries and other crucial supporting documents.
“The committee notes that the county government of Bomet operates Bomet County Bursary Fund using commercial bank accounts,” Osotsi said.
“The committee directs the governor to wind up the commercial bank accounts and ensure that the fund accounts are opened at the Central Bank of Kenya in line with Regulation 82 (1) (b) of the PFM (County Governments) Regulations, 2015,” he added.