Ministry of Defence incurred a total of Sh1.42 billion of unbudgeted funds for projects belonging to other ministries, a new report by the Auditor General Nancy Gathungu has revealed.
The funds were spent during the 2021-22 financial year.
Gathungu has detailed three key projects which include Uhuru and Central Park rehabilitation in Nairobi which was an initiative of the State House through the Nairobi Metropolitan Service (NMS).
Out of the total contract sum of Sh1.18 billion, only Sh778.1 million was paid by NMS forcing the Ministry of Defence to foot the remaining Sh405.3 million.
“This was contrary to Section 53(8) of the Public Procurement and Asset Disposal Act, 2015 which requires an accounting officer not to commence any procurement proceeding until satisfied that sufficient funds to meet the obligations of the resulting contract are reflected in the approved budget estimates,” the report states.
Retired President Uhuru Kenyatta commissioned the two parks a few days before the end of his tenure after close to a year of renovations.
Uhuru had earlier on told off critics regarding the ongoing renovations insisting that it was part of plans to change the face of the city.
The closure of the iconic parks for renovation did not sit well with a section of Kenyans who claimed that it was a land-grabbing scheme.
"Those who were saying we have grabbed Uhuru Park and Central Park come to see the work we are doing,” Uhuru stated.
The Ministry, according to the report, further used Sh424,928,279 from its coffers to construct the National Police Service Level IV Hospital out of the contract amount of Sh824,928,279.
This implies that only the procuring agency which is the Ministry of Interior managed to raise Sh400 million.
An additional Sh599, 628, 135 was forked out for a Level IV Hospital for the State Department for Correctional Services yet only Sh400 million was paid for the project.
The total cost of the project was Sh999, 628, 135.
Shockingly, the unpaid money spent on these projects was not included as part of the pending bills, this despite a physical verification in October 2022 showing they were already complete.
Gathungu, however, stated that the Ministry of Defence had continuously requested the outstanding balances from the respective Ministry and Agency without success due to the unavailability of funds.
“The management did not disclose how the extra expenditure committed by the Ministry would be funded in the absence of an approved budget,” she said.
“In the circumstances, management was in breach of the law."
