A project initiated by the government eight years ago to address the jobs crisis in the country has failed to live up to expectations.
A new audit report on the World Bank-funded venture implemented by the Micro-Small and Medium Enterprises Authority (MSEA) shows the project has failed.
Auditor General Nancy Gathungu said in the report that despite reaching the targeted number of youths, the “intended objective of increasing job opportunities was not optimally achieved”.
“Despite the positive impact in terms of achieving the targeted number of youths, there was a risk that the main objective of creating employment and increasing earning opportunities may not have been optimally achieved,” the auditor said.
The report revealed that as of June 30, 2023, more than Sh9.2 billion had gone into the Kenya Youth Employment and Opportunities Project (KYEOP).
Gathungu said the audit revealed some youths did not start businesses, despite receiving cash for capital injection into the ventures.
Others wound up their business while half of those sampled for the audit review, could not be reached.
Gathungu said the youths were either unreachable on the phone to give directions to their premises or were non-cooperative by failing to give an audience to the auditors.
“This raised doubts as to whether their businesses were up and running or they were existing beneficiaries,” the Auditor General said, adding that the unreachable and uncooperative lot was allocated Sh83 million.
Gathungu said there was doubt on the achievements of the intervention objectives-named Future Bora-as “the projects did not meet scalability and sustainability objectives”.
“There is a risk that the unreachable youths may not have commenced businesses or they may have failed. The businesses funded may not have created or increased earning opportunities as intended,” the auditor said.
In what could put MSEA officials on the spot, Gathungu said the youths were left to their own devices despite being given billions.
“The youths were not regularly held to account. There was reduced frequency of monitoring and removal [of non-compliant ones]. This may have increased the possibility of the funds not being put to the intended use,” the report read.
“MSEA could not ascertain whether all the beneficiaries had established businesses.”
It has further emerged that the business plans the youths presented to be awarded capital were not considered.
“Youths who won the competition were randomly awarded funds without considering their business plans,” the auditor said.
Some beneficiaries confessed to receiving more money than they asked for, she added.
“For instance, a youth who had a business plan that required Sh150,000 was awarded Sh3.6 million, indicating that the youth may have been awarded funds that they couldn’t utilise,” Gathungu said.
The Auditor General also highlighted inefficiencies in the implementation of the project, including delays in the disbursement of funds to the youths.
“The differences between the targets as per contracts and the planned targets may have resulted in payment for undelivered services for some of the interventions,” the report reveals.
MSEA, however, defended itself on the issues saying there was coordination and the use of GPS to enable tracking of monitoring activities in the field.
The project had four interventions where successful youth applicants were given Sh40,000 each as seed funding, business training at Sh40,000 per youth, and a business plan competition where youths developed plans that were evaluated for viability.
Youths with the best business plans were awarded grants of either Sh3.6 million or Sh0.9 million each to fund their business ideas.
There was also an innovation challenge where four organisations were identified and funded with Sh30 million each.
