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<blockquote><div class="quotetitle">Quote from <a class="profile-link highlight-moderator" href="https://lawguide.co.ke/understanding-law/legal-forum/profile/lawyer/">Lawyer</a> on July 28, 2025, 10:03 am</div><div id="pl-7270"  class="panel-layout" ><div id="pg-7270-0"  class="panel-grid panel-no-style" ><div id="pgc-7270-0-0"  class="panel-grid-cell"  data-weight="1" ><div id="panel-7270-0-0-0" class="so-panel widget widget_sow-editor panel-first-child panel-last-child" data-index="0" data-style="{&quot;background_image_attachment&quot;:false,&quot;background_display&quot;:&quot;tile&quot;,&quot;background_image_size&quot;:&quot;full&quot;,&quot;background_image_opacity&quot;:&quot;100&quot;,&quot;border_thickness&quot;:&quot;1px&quot;}" ><div
			
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	<p dir="ltr" data-pm-slice="1 1 []">A recent report from the Auditor General has revealed widespread financial mismanagement and irregularities across multiple sectors of the Kenyan government, raising serious concerns about accountability and the prudent use of public funds. The comprehensive audit for the 2023/2024 financial year highlights significant issues, including stalled projects, irregular payments, and systemic weaknesses in oversight mechanisms, resulting in billions of shillings in losses for taxpayers.</p>
<p dir="ltr">The audit exposed that 24 ministries and departments have failed to complete projects valued at approximately Sh37.92 billion. These stalled initiatives, spanning critical sectors such as infrastructure, education, and public services, have yielded little to no public benefit despite substantial investments. The report points to poor planning and lax oversight as primary contributors to these delays, which continue to escalate costs and strain national resources.</p>
<p dir="ltr">Among the high-profile projects flagged is the Mombasa Gate Bridge, which has utilized only Sh938 million of its allocated budget while 98 percent of its funds remain undrawn, underscoring inefficiencies in project execution. Similarly, the Africities Convention Centre in Kisumu County remains incomplete, further illustrating the pervasive issue of stalled developments.</p>
<p dir="ltr">The Auditor General's findings extend beyond stalled projects, uncovering significant financial irregularities in various government entities. The Postal Corporation of Kenya, for instance, faces a dire financial situation with a Sh7.7 billion deficit. The audit revealed that the corporation’s current liabilities, amounting to Sh9.5 billion, far exceed its assets of Sh1.8 billion, pushing it to the brink of collapse. This imbalance raises questions about the sustainability of its operations and the management of public funds.</p>
<p dir="ltr">The National Social Security Fund (NSSF) was also scrutinized for mismanagement, with the audit revealing that it purchased government bonds worth Sh5 billion at a premium, only to sell them at a loss. Additionally, the NSSF wrote off over Sh940 million in tax refunds due to delayed reconciliation and poor record-keeping. The report further noted that Sh158 million remains unclaimed by 18,671 pensioners, with weak follow-up mechanisms hindering efforts to trace these beneficiaries.</p>
<p dir="ltr">The report underscores systemic challenges faced by Kenya’s oversight institutions, including the Auditor General, Controller of Budget, and Commission on Revenue Allocation. These bodies, tasked with ensuring fiscal accountability, are crippled by underfunding, limited enforcement powers, and government disregard. The audit revealed that the Office of the Auditor General receives only 0.2 percent of the national budget, significantly less than its counterparts in Uganda and South Africa, hampering its ability to oversee an increasing number of entities, which grew from 1,192 in 2016/17 to over 12,700 in 2023/24.</p>
<p dir="ltr">The Constitutional Implementation Oversight Committee has recommended increasing the Auditor General’s budget allocation to 0.5 percent of national revenue and passing the Public Audit (Amendment) Bill, 2024, to grant the office greater financial autonomy. These measures aim to enhance operational flexibility and reduce bureaucratic delays that currently undermine effective oversight.</p>
<p dir="ltr">County governments were not spared in the audit, with widespread financial mismanagement reported across multiple devolved units. In Nairobi County, the audit flagged Sh20 billion in financial irregularities, including duplicated salary payments due to employees sharing bank accounts and unverifiable allowances totaling over Sh100 million. Tana River County faced criticism for ethnic bias in employment, with 38 percent of its workforce from a single ethnic community, violating national diversity laws. Additionally, 331 employees in the county were subjected to excessive salary deductions, breaching the Employment Act.</p>
<p dir="ltr">Public universities also came under scrutiny, with an estimated Sh14 billion lost due to corruption and weak financial oversight. The audit highlighted irregular allowances, overpayments, and dubious contracts, with nine universities alone disbursing Sh559 million in questionable payments. These findings have prompted calls for stronger internal controls and accountability measures to safeguard public funds.</p>
<p dir="ltr">The education sector was a focal point of the audit, with secondary schools and public universities exhibiting significant financial misconduct. The Auditor General’s first comprehensive audit of secondary schools revealed rampant violations of Ministry of Education fee guidelines, including unauthorized fee hikes and unbanked fee collections. For instance, Kinyui Boys High School failed to deposit Sh2.9 million in fees, while Ndivisi Girls could not account for Sh10.7 million of the Sh43.6 million collected.</p>
<p dir="ltr">In public schools, infrastructure deficiencies were also highlighted, with learners sharing toilets at ratios far exceeding national standards, averaging 66 boys and 62 girls per toilet compared to the recommended 30 and 25, respectively. The audit further exposed Sh16.6 million disbursed to 14 ghost schools, underscoring the need for stricter oversight in education financing.</p>
<p dir="ltr">The Auditor General’s report has sparked widespread calls for reforms to address the systemic issues plaguing Kenya’s public financial management. Civil society groups, education stakeholders, and parliamentary committees are urging the government to strengthen oversight mechanisms, enhance transparency, and grant punitive powers to oversight bodies to enforce compliance. The report emphasizes the need for legislative interventions, such as the passage of the Public Audit (Amendment) Bill, to empower the Auditor General to hold government entities accountable.</p>
<p dir="ltr">The findings also highlight the urgent need for improved financial planning and project management to ensure that public funds deliver tangible benefits to citizens. As Kenya grapples with a national debt of Sh11.1 trillion and persistent revenue shortfalls, the government faces mounting pressure to address these inefficiencies and restore public trust in its fiscal stewardship.</p>
<p dir="ltr">The Auditor General’s report serves as a stark reminder of the challenges facing Kenya’s public sector, from stalled projects and financial mismanagement to inadequate oversight and systemic corruption. As stakeholders demand accountability, the government must act swiftly to implement the recommended reforms and ensure that taxpayer money is used effectively to drive development and improve service delivery. Without meaningful action, the cycle of waste and irregularities risks further eroding public confidence and hindering Kenya’s progress toward sustainable growth.</p>
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