How State officials use parallel reporting structures and intimidation to steal public funds

A new set of documents tabled before Parliamentary Accounts Committee attests to a carefully planned and premeditated theft at the National Youth Service (NYS).

The evidence adduced before the Nicholas Gumbo-led committee by star witnesses — former Cabinet Secretary Anne Waiguru and former hairdresser turned millionaire Josephine Kabura — summed up Kenya's ineffective fight against graft.

Evidence pointing to the use of parallel reporting structures, dysfunctional leadership, the unilateral requisition for a supplementary budget and other key decisions as well as intimidation of accounting officers by fashioning orders as "presidential directives" pointed to a well-executed campaign.

The testimony of people ferrying money in bags like potatoes, large over-payments for works barely done and finger-pointing were highlighted in some of the presentations to the committee.

Former Planning PS Peter Mangiti presented to the committee documents which showed that operations at the ministry were so haphazard that the Sh3.5 billion supplementary budget was planned on a handwritten note by one of the advisers of former devolution PS Anne Waiguru.

The handwritten note budgeted Sh80 million as miscellaneous, Sh847 million for cohorts, Sh744 million for food and rations, Sh300 million for ablution blocks, Sh200 million for fuel, Sh200 million for motor vehicle maintenance and Sh172 million for uniforms, beddings and nets.

"When the supplementary budget was granted, the CS gave instructions through one of her advisers Betty Maina to the Director General NYS on how the money was to be allocated in the IFMIS," documents presented to the committee indicate.

The centralisation of procurement at NYS was done by the former CS citing an "executive decision" and against the wishes of her former PS, the documents note.

At the headquarters, Mangiti publicly stated that the CS had isolated him and effectively created "a parallel reporting and command structure" in which she dealt with the director of administration Hassan Noor.

"Heads of departments in accounts and procurement were instructed by the CS not to work under my supervision but to report directly to Hassan since in her opinion, I had become difficult. Those who opposed this directive were victimised," Mangiti claimed.

The accelerated appointment and promotion of Adan Harakhe to the Senior Deputy Director General of NYS in charge of finance, administration and programmes also came into sharp focus at the committee.

This is the man who claimed his IFMIS password was stolen to commit hundreds of millions to fictitious payments.

It emerged in the committee hearings that Harakhe's official appointment to the position was vetoed by the Public Service Commission (PSC) because it was dissatisfied with the way the matter was handled.

Mangiti went as far as claiming that Waiguru expunged academic requirements from indents delivered to PSC.

The mystery of the Sh791 million 3.5 kilometre road in Kibera was also brought to light in the appearances of the top ministry officials. It emerged that the development of the road was taken over from the Ministry of Land, Housing and Urban Development with view of constricting it at a cheaper rate.

The take-over by the NYS was also meant to demonstrate the potential for the service to undertake such works at costs lower than the market rate. On average, the tarmacking of a 3.5 kilometre road would cost about Sh105 million at a rate of Sh30 million a kilometre.

But due to fraud, the road ended up being one of the most expensive in the country, costing seven times the projected cost and defeating the very purpose for the take-over.