Payments of more than Sh240 million made to consultants hired by the Health ministry in a World Bank-funded Covid-19 response project are now the subject of an audit probe.
Auditor General Nancy Gathungu has raised concerns that the ministry paid consultants varying monthly allowances of between Sh75,000 and Sh120,000 without stating the basis for arriving at the same.
She also cast doubt on the payments after the ministry failed to provide for audit review contracts for the period from January 2022 to June 2022.
"The payments made were not supported by invoices and reports from consultants,” Gathungu said after a review of the Covid-19 emergency response project grant as of June 30, 2022.
She said that without the documents to back up the payments, the accuracy and completeness of compensation of employees to the tune of Sh241,631,465 could not be confirmed.
Further to this, details show that the ministry received Sh2.07 billion from a budget of Sh6.9 billion, meaning 70 per cent of the budget was not funded.
Similarly, the project spent Sh1.9 billion out of the approved expenditure budget of Sh3.3 billion resulting in 42 per cent of the budget remaining unspent.
Gathungu says the underfunding and underperformance may have affected the project’s key objective.
World Bank extended a grant and loan to Kenya to help in preventing, detecting and responding to the threat posed by Covid-19.
The money was also to help in strengthening national systems for public health preparedness, objectives Gathungu says were not met satisfactorily.
“My opinion is not modified in respect of this matter,” the Auditor General said in the report tabled in Parliament recently.
Health officials are further in trouble for failing to disclose that they retained Sh10 million as fees for a gas installation project.
The ministry spent Sh100.8 million on gas installations at various hospitals and thus retained 10 per cent of the contract sum.
However, the retention fee withheld was not disclosed in the financial statements, hence the query by the Auditor General.
The payments were made out of Sh139,860,111 the ministry set aside for rehabilitation and renovation of plant, equipment and machinery.
“In the circumstances, the accuracy and completeness of acquisition of non-financial assets - retention fees of Sh10,081,768 could not be confirmed,” she said.
Gathungu has further flagged imprests which staff had not surrendered at the time of the audit.
In the financial statements, officials stated that only Sh4.7 million was paid out to employees for facilitation outside their workstations.
However, an analysis of the imprest register and supporting schedules revealed unsurrendered imprest amounting to Sh43.6 million.
This resulted in an unreconciled variance of Sh39,002,648 which the management did not explain satisfactorily.
“The accuracy and completeness of accounts receivables - imprests and advances of Sh4,668,877 could not be confirmed,” the auditor said.
Gathungu further raised concerns that the project managers were yet to update the imprest register after Sh40.2 million issued during the year was not factored in.
“The effectiveness of controls on issuance and recording of imprest could not be confirmed,” the auditor said.
Among the interventions by the project were medical supplies and equipment, training, facilitating quarantine and isolation centres, medical waste management, and community outreaches.
The project commenced in March 2020 and is expected to run until March 31, 2025.
The project management had indicated earlier they procured Covid-19 test kits through Kemsa, PPEs and hand washing facilities.
At the height of the concerns of corruption in procurement, there were claims the ministry micromanaged the World Bank donations.
There were questions regarding the expenditure of Covid-19 emergency funds, largely those sourced from international donors and the World Bank.
Among the queries was how Kemsa would proceed to make payments for supplies at the height of allegations of fraud in the mode of procurement.
It also emerged that the medical supplies agency engaged some companies before the procurement process was complete.
Some companies were given commitment letters to supply items and were to agree with Kemsa on the prices later.