Government agencies will only receive funds after showing proof of good spending during the initial phase of a project, the Building Bridges Initiative (BBI) report has proposed.
This is among the radical proposals contained in the report aimed at substantially curbing wastage of public resources. Entities that audit government departments will also be granted more powers in a bid to increase transparency in public expenditure.
The proposals are targeted at strengthening the offices of the Auditor General and the Controller of Budget (CoB), which will rule whether a government entity spent money prudently on a project before it can get more allocations.
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The Public Finance Laws (Amendment) Bill, 2020 – which is contained in the BBI report – reviews the law setting up CoB and gives the office additional powers to look into whether funds allocated in a previous year have been wasted before it okays the release of more funds. CoB is currently tasked with monitoring budget execution by government agencies.
“The Bill seeks to amend the Act to require CoB to carry out due diligence on all ongoing projects, to ascertain whether money previously approved for the project has been utilised prudently, before the Controller authorises release of more funds for the projects,” reads the report.
CoB has over the years lifted the lid on how extravagant government officials can be. Details as to how much MPs, MCAs and even the president and his deputy spend on non-essentials such as tea or travel while development projects suffer are now public knowledge.
The Public Finance Laws (Amendment) Bill, 2020 also reviews the Public Audit (2015) giving the office of the Auditor General powers to hire its own staff. This is unlike the current scenario where the mandate lies with the Public Service Commission.
This is expected to give the auditor more teeth when looking into the books of different government entities.
Since it was established, the Office of the Auditor General has fanned storms by flagging suspect spending by government bodies. For example in 2016, President Uhuru Kenyatta attacked former Auditor General Edward Ouko for his report on the use of the Sh280 billion raised from issuance of the Eurobond in 2013. Ouko retired last year. Nancy Gathungu replaced him in July this year.
The Auditor General and the CoB were at one point under the same office at the Treasury, but were split following the adoption of the 2010 Constitution.
The BBI report also proposes the review of the Public Finance Management Act (2012), adding clauses that provide for government officials to be held responsible for loss of public funds.
It also reviews the public procurement law, requiring accounting officers to increase transparency of procurement process while ensuring there is enough money to pay suppliers.
“Money should be available for prompt payment of goods or services being procured. For an accounting officer to procure goods or services without a procurement plan amounts to an offence,” reads the report.
The Bill also proposes amending the Public Procurement and Asset Disposal Act, requiring government agencies to undertake due diligence on companies they plan to award contracts. This is expected to reduce instances where contractors are unable to finish projects due to limited capabilities.