This is after the audited reports for the 2010-2011 financial year revealed that the government did not spend more than Sh37 billion of the budgeted funds.
According to the audited reports 44 previous ministries failed to absorbs Sh26 billion of the budgeted funds while three ministries used up more than Sh700 million in which Sh362 million of the amount was spent without Parliament’s approval.
Deputy Auditor General Alex Regeru and Nambale MP Bunyasi Sakwa warned the country will have a financial crisis compounded by underdevelopment unless the trend ends.
“We attribute the low expenditure to slow implementation of projects and Treasury bureaucratic issues, failure by errant accounting officers to approve payments, delayed disbursement of donor funds and failure of development partners to submit expenditure returns,” explained Regeru.
“We will not be able to achieve the President’s double digit growth economy. The Cabinet Secretary should clamp down on early planning of the procurement process, because if this money is returned it means there are projects with economic value that were not done, that will hold us back,” Sakwa said.
National Treasury Secretary Henry Rotich attributed the loss to cash flow leakages but said that each government ministry accounting officer will have to appear before the committee to explain reasons for under utilizing their budgeted funds.
PAC Chairman Ababu Namwamba (Budalangi MP) accused the Treasury of not taking the matter seriously saying that their response was a copy and paste answer previously to the committee by his predecessors.
“This has become a cyclic challenge. Last financial year it was Sh37 billion, this current financial year it is Sh35 billion,” Namwamba added.
“But the answer is standard. The exact words that the committee captured last year are the exact words that the Treasury is telling us right now.”
“It just raises concern with me as to whether the Treasury is doing everything possible to address this particular challenge of lack of funds absorption,” said Namwamba.
Rotich assured the House watchdog team on the expenditure of public funds that the National Treasury is drafting a bill to be brought before the National Assembly which will address absorbing of funds as envisioned both in the Public Finance Management (PFM) Act and the Constitution.