Auditor General Edward Ouko has raised fears of a possible loss of Sh2.5 billion in the procurement of fertiliser by the government last year.
Ouko in his 2017-18 audit of the Agriculture ministry flags suspicious transactions in the procurement of subsidised fertiliser that may have led to loss of billions of shillings of public funds.
The ministry ended up spending Sh8 billion to obtain 147,775.25 tonnes instead of the Sh5.5 billion that was approved.
Initially, the ministry had a Sh5 billion budget to procure 168,480 metric tonnes of fertiliser, which was adjusted upwards to Sh5.5 billion under circumstances Ouko indicates were not justified.
The only reason given was that the ministry had earmarked to clear Sh7.99 billion NCPB debt, which again Ouko says there was no documentary evidence provided to link revision of the budget upwards.
In the suspicious spending, the ministry was allocated Sh2,393,092,810 whereas National Cereals and Produce Board procured fertiliser worth Sh5,719,134,745.
“This procurement exceeded the budget amount of Sh5,569,300,200 by Sh2,542,927,355,” Ouko said in the report.
“No reason was given for failure by the State Department to order the full amount of 168,480 tonnes of fertiliser as in the approved budget. No explanation was provided for the revised cost of the fertiliser.”
Ouko at the same time questioned Sh 2.3 billion unaccounted revenue from the sale of the fertiliser by the cereals board.
According to the audit report, both ministry and the board were operating loosely with no binding agreement, an arrangement that could not guarantee accountability and transparency.
“It was noted that no agreement was signed between the State Department and NCPB about the handling of the fertilizer stocks as well as the sales proceeds. No evidence was provided to show that the State Department carried out any reconciliations for sales made and quantity delivered by June 30, 2018 ” the report reads.
