The details emerged during a presentation by Odhiambo at a meeting of Permanent Secretaries and Accounting Officers chaired by Prime Minister Raila Odinga whose office is responsible for coordinating various ministry programmes.
Odhiambo identified the best and worst performers in terms of absorption of resources. Odhiambo blamed the problem on weak governance, which includes lack of sufficient financial controls and graft as well as poor planning of projects and delays in procurement.
Other challenges cited were delays in processing payments to contractors, poor financial management information systems that provide unreliable data leading to delays in release of donor funds and donor conditionalities. Recurrent expenditure records a high absorption rates because it is essentially the wage bill for payment of salaries.
Poor absorption rate
The last financial year recorded the lowest absorption rate in six years of development expenditure by Government at 55.1 per cent.
It was a sharp decline from 71.6 per cent the previous year and is beaten only by the 2007/08 financial year where spending was at 55.9 per cent of available funds.
Head of Public Service Francis Kimemia blamed it on bureaucratic procurement procedures, lack of proper coordination and cancellation of funding by development partners.
Prime Minister Raila Odinga, on the other hand, blamed procurement rules for slow implementation of projects. He said corruption where MPs are lobbied by losing bidders for State contracts to use Parliamentary committees to stop the procurement process even after State agencies have resolved the matter.
Finance Minister Njeru Githae said Kenyans and donors expect service delivery from the allocated funds.
“You (permanent secretaries) are letting us down as Treasury because when you don’t absorb the money you are letting the donors, Treasury and Kenyans down,” said Githae.
Chairman of the Parliamentary Budget Committee Elias Mbau said the low absorption by the Government depicts inefficiencies and weaknesses in the budget process.
“Low absorption in government is an issue of concern, especially for a country that is intent on borrowing funds,” said Mbau, the Maragwa MP.