• The auditor questioned the purchase of a 4-wheel driver heavy-duty vehicle for Governor Nyong'o at a cost of Sh19.54 million.
• The county hand-picked a local company and awarded it a Sh20 million tender for advertising and media branding.
Auditor General Nancy Gathungu is questioning the financial management in Kisumu county, flagging suspicious expenditures and procurements in excess of Sh2 billion.
In her 2018-19 audit report, Gathungu has indicted the county for constantly engaging in irregular procurements where the officers mutilate laws and dish out contracts to specific contractors – some not pre-qualified.
She faults the county administration for making payments running into millions of shillings for items not delivered and projects not done.
In addition, several expenditures running into hundreds of millions of shillings are unexplained as the auditor establishes poor cash management in the county executive.
The auditor questions the purchase of a 4-wheel drive vehicle for Governor Nyong'o at a cost of Sh19.54 million.
Gathungu says the vehicle was procured through open tender and pointed to several anomalies in its procurement.
For instance, the requisition from the user department was signed long after the vehicle was delivered. The vehicle's engine capacity was 4,451cc, which exceeds the maximum limit of 3,000cc for governors.
“Further, the bid documents to suppliers were delivered manually instead of uploading them on the county's website as required by Section 98 of the Public Procurement and Asset Disposal Act, 2015,” the report reads.
The county hand-picked a local company and awarded it a Sh20 million tender for advertising and media branding.
This was despite the fact that the county had prequalified 26 supplies and contractors for public relations, advertising agency and media management services.
Even more bizarre, the firm that was picked was not among those prequalified service providers. This is contrary to Section 94 of the PPAD Act.
The audit rot is a slap in the face for Nyong'o, who once put governors on the spot for misuse of public money when he served as the chairman of the powerful Senate County Public Accounts and Investments Committee (CPAIC) when he was senator.
The county executive, the report shows, has put some Sh78.56 million at risk of loss. The money has been paid to a contractor for preparation of a valuation roll.
The cash was part of the Sh141.05 million contract awarded to the contractor.
The roll is yet to be tabled in the assembly three years after the contract period elapsed, thus raising concerns the roll was never prepared after all.
The contract also varied along the way and the figure shot upwards by 18 per cent against the 15 per cent ceiling.
Kisumu is also on the spot for dishing out a Sh2.65 million contract for insurance services to a firm that was not pre-qualified.
The auditor notes that the county was short-changed when it purchased two parcels of land for Sh12.40 million owing to the officers' failure to do due diligence prior to the purchase.
The county opted to hand-pick a seller instead of inviting interested sellers for competitive pricing. In addition, no valuation was done to determine the value of the property.
Kisumu also paid out Sh1.99 million to a local company for equipping a borehole project in Nyando subcounty against work done and certified costing Sh1.28 million.
The county has also been indicted for making payments for goods not delivered. During the year under review, Kisumu paid out Sh2.69 million for supply of 153,000 fingerlings.
“Physical verification carried out on July 16, 2019, showed that only 90,000 fingerlings has been delivered leaving a balance of 63,000.
The auditor could not establish the whereabouts of Sh50 million, which the county declared to have transferred to imprest operations.
There were no supporting documents to prove the money was transferred for the said operations.
The county executive also did not make disclosures of Sh684.80 million transferred to the county assembly.
The auditor established several inaccuracies in the county’s books, including lack of reconciliation of cash and bank balances, inaccuracies on statements of assets and liabilities and inaccuracies in the statements of receipts and payments.
This raised concerns that county officers could have exploited the same to embezzle taxpayers’ money.
Residents, the auditor revealed, are at risk of losing Sh783.34 million due to the county officers’ reluctance to recover imprest advanced to county staff.
The audit established discrimination where only 2,572 of 3,320 employees are benefiting from the Sh40 million remitted to NHIF for comprehensive coverage.
“The medical scheme is therefore discriminatory and contrary to Section 46(2) (h) of the County Governments Act, 2012.
Kisumu also spent Sh32.57 million on emergencies but has never operationalised Emergency Fund.
The county is also on an employment spree with Sh3.43 billion out of Sh8.92 billion budget, or 38.5 per cent growth towards payment of salaries and wages. The law limits expenditures at Sh35 per cent.
Kisumu has not put in place an audit committee and could be losing millions of shilling in revenue due to lack of integrated revenue collection systems.