County assemblies face scrutiny for overseeing irregular and illegal payments, accumulating large pending bills and engaging in ‘tribal' hiring practices.
The Senate County Public Accounts Committee has revealed shortcomings it believes are impacting the effective management of finances and operations in the counties.
These findings are detailed in the Committee's report on its review of financial audit reports for the county assemblies for the period ending June 30, 2024.
According to the report, assemblies have been channelling money to entities not anchored in law, making such payments irregular, unlawful and unauditable.
Specifically, funds were paid to the County Assemblies Forum (CAF) and the Society of Clerks-at-the-Table (SOCATT).
“The committee noted that county assemblies made payments to SOCATT and CAF, which were irregular and unlawful,” the report states.
The senators have now recommended the immediate suspension of these contributions and the surcharge of any accounting officers who authorise further payments.
If enforced, the move would deal a blow to lobbying outfits frequently used by MCAs and clerks to advance their interests.
The committee also raised the alarm over the ballooning pending bills in county assemblies, warning that the debts are stifling businesses and crippling service delivery.
“The accumulated pending bills in counties have significantly affected service providers, leading to the closure of businesses, stalled projects, poor service delivery and slowed economic growth,” the report notes.
It further revealed that many contractors are battling court cases with financiers and suppliers, while others have sunk into poverty amid the high cost of living.
Some, it added, have suffered mental health breakdowns or even died due to debts owed by counties.
The Controller of Budget takes into consideration the efforts made by a county government to clear inherited pending bills when approving exchequer releases.
“The committee recommends that all county governments pay verified pending bills amounting to less than Sh1 billion by the end of this financial year and those above Sh1 billion by the end of the next financial year,” the committee said.
The team also requested that counties prepare and submit to the Controller of Budget a payment plan, prioritising the payment of pending bills as the first charge on the County Revenue Fund.
The senators further flagged the lack of ethnic diversity among employees of county assemblies.
Most of the county assembly staff were mainly drawn from the dominant community in the devolved unit.
“The county assembly should work progressively towards attaining the requirements of the provisions of Section 65(1) (e) of the County Government Act on ethnic inclusivity,” the report says.
The committee also established that in some county assemblies, the staff were earning less than a third of their basic pay, contrary to Section 19 (3) of the Employment Act 2007.
“The county entities should configure their IPPD system such that it can lock out commitments beyond the accepted thresholds,” the committee said in the report.
The panel also raised concerns over the possibility of the county assembly's assets getting lost due to a lack of fixed asset registers.
The assembly also flagged huge outstanding imprests by county assemblies.
“The committee further recommends the sanction and surcharge of accounting officers who fail to recover outstanding imprests in line with Regulation 93(7) of the PFM (County Government) Regulations, 2015,” the report states.
