Nairobi Governor Evans Kidero was Wednesday questioned over Sh21.9 billion irregular transactions by the Nairobi county government.
Dr Kidero faced the Senate’s Public Accounts and Investment Committee, which wanted to know why his government failed to transfer Sh10 billion it collected to the Central Bank of Kenya.
The senators further questioned the withdrawal of another Sh11 billion from the exchequer without the approval of the Controller of Budget.
The senators also wanted to know why Nairobi County borrowed another Sh298 million, yet the money had not been factored in the approved county estimates.
The transactions were flagged by the Auditor-General in his county government audit report for the 2014/2015 financial year.
Kidero insisted that the transactions were above-board and that the county government acted within the law.
The senators demanded proof.
“The only evidence that would clear this is documentation to show that there was authority to spend without transferring the money to the CRF account,” said Senator Kimani wa Matangi.
Under the Public Finance and Management Act, money collected by the county government must be transferred to its revenue account in a commercial bank before it is ‘swept’ to the County Revenue Fund (CRF) maintained at the Central Bank of Kenya.
In his defence, Kidero cited a judgment by Justice Isaac Lenaola which stated that the Senate had no jurisdiction over the money collected by county governments as local revenue.
County Executive Committee Member for Finance Gregory Mwakanongo explained that county governments borrowed to cater for expenditure relating to insurance and that there were delays in release of exchequer funds.
According to the audit report, the Nairobi county government has weak internal control mechanisms in regard to revenue collection and accountability.
The governor was directed to appear before the committee on May 9, where he is expected to respond to additional audit queries and also answer further questions raised by members.