Accountable spending of the Covid-19 billions could be the missing bullet in the fight against this global pandemic.
Concerns have emerged that due to ineptitude and systemic weaknesses, the coronavirus emergency billions could be going into non-priority areas or ending up in pockets of individuals.
On Thursday, the National Treasury opened an audit into how the 47 counties had spent Covid cash allocated to them. Treasury PS Julius Muia notified governors that auditors would be dispatched to counties beginning this week.
This is a timely move. Efforts to deploy resources and mobilise additional funding to support this war cannot succeed in an opaque atmosphere. President Uhuru Kenyatta had promised that every shilling and every cent will be accounted for.
While Kenyans appreciate this commitment, auditing counties alone isn’t enough as they handle just a fraction of the billions. A swift assessment has to start from the national government, looking into costs, procurement, commissioning and whether they constitute good value.
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The Ministry of Health, counties and the Covid-19 Emergency Response Fund Board needs to furnish the public with an elaborate but convincing spending breakdown. This will inspire confidence. So far, a cursory look at spending at the two levels of government paints a grim picture. In April, there was controversy when Sh48 million went into ambulance leases, airtime, tea and snacks.
This happened when front-line workers were contending with lack of personal protective equipment (PPE), poor infrastructure and inadequate medical supplies to deal with a surge in cases.
Blatant attempts at violating the law governing public finance have been with us for years and if allowed to continue, we warn, will drag the country away from what needs to be accomplished — taming the pandemic.
We also call on individuals and corporates who might have locked Covid billions they received in various forms from the government to free it up.
True, we understand that most of this money was payment by government to individuals and businesses and that they have every right to it as they deem fit. Indeed, most of them must have looked at the uncertainty that has been occasioned by the Covid-19 pandemic and taken a wait-and-see approach.
Investors can’t, for example, build a new plant. They might end up losing their money as demand has really been depressed. So they have locked up this money in fixed deposit accounts. Others have converted the money into dollars as they sought a safe haven for their wealth.
Treasury Cabinet Secretary Ukur Yatani acknowledges that a lot of the money remained locked in bank accounts, but says it was due to a combination of factors. These, he says, include uncertainties around the investment climate.
In his own estimation, this will go on for a month or two, and then banks will start lending to the private sector. The CS further says that while banks had a lot of money, which they were rushing to lend to the government, the uptake had been low. This could force them to release the funds to the general economy.
We applaud the government for what it has done so far in releasing money to businesses and even giving most of the tax reliefs to help jump-start the economy.
Unfortunately, the additional Sh156.7 billion that was added into circulation between March and May this year, nearly twice the Sh82.3 billion that was injected into the economy over a similar period last year, did not percolate into the economy.
Ideally, banks should have used this money to lend to the private sector. Instead, they are lending the money to government, even as businesses continue to starve for lack of capital.
These are no ordinary times. Even the government had to forego part of its taxes in what was aimed at helping the businesses stay afloat.
Businesses should have reciprocated by using the money they have received from the government in terms of retained taxes and payments to save jobs.