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Nakuru County's debt rises by Sh1.5b in nine months

RIFT VALLEY
By STEVE MKAWALE and PATRICK KIBET | July 20th 2016

The county government accumulated an unexplained Sh1.5 billion debt in nine months, a state agency has revealed.

According to the Controller of Budget the county government failed to explain how pending bills shot to Sh3.95 billion in the 2015-2016 financial year from Sh2.4 billion reported by the end of the previous year.

In its third quarter report released recently, the office of the Controller of Budget (CoB) said the debt level represented 28 per cent of the total 2015-16 budget above the 20 per cent recommended by the Public Finance Management (County Governments) Regulations.

According to the CoB report, the county spent Sh6.73 billion in the first nine months of 2015-16, with Sh5.34 billion used in recurrent expenditure and Sh1.39 billion going to development.

The report shows that despite the high debt, no funds were used to service it. Expenditure on personnel emoluments rose from Sh2.88 billion in 2014-15 to Sh3.21 billion in 2015-16. This represented a 11.5 per cent increase. A county assembly committee report showed that the county government hired 180 workers illegally. 

This revelation sparked protests, and now civil rights activists want Ethics and Anti-Corruption Commission (EACC) officers from Nairobi to lead investigations into the recruitment saga.

Speaking in Nakuru town two days after the commission's local office announced it began investigations into the employment scam, activists Hezron Manyara and Simon Nasieku said officers from the regional office cannot be trusted to investigate independently.

"We cannot trust EACC officials in Nakuru to investigate the county secretary and other officials who were implicated when they have not told us what happened to the investigations they were carrying about the graft allegations against Finance Executive Anne Njenga," Mr Manyara said.

The Nakuru Peoples' Accountability Forum official was referring to another investigation that started in December last year targeting two senior officials of the county government who had allegedly accumulated unexplained wealth within a short time.

But South Rift Region EACC Deputy Director Gilbert Lukhoba denied the claims saying: "we are never influenced by anyone and our business is not to protect people."

The county executive blamed the National Treasury for the accumulated debt, saying in the past financial year, there had been unexplained delays in releasing money to the county.

Finance Chief Officer Torome Kapaya said the debt has accumulated over two financial years and is inclusive of Sh1.3 billion, which was committed to unfinished projects.

A few months ago, the Salaries and Remuneration Commission said Nakuru was the county with the highest debt in Rift Valley.

Recently, MCAs questioned how the debt, which was reflected in the 2016-2017 budget, grew into billions of shillings in such a short time.

The debt is one of the sticking issues raised by MCAs who have delayed the passage of the Appropriation Bill 2016. The ward representatives also cited failure by the executive to demonstrate how it would raise funds to employ doctors, nurses, nursery school teachers and administrators.

The CoB report showed that the high wage bill, which accounts for 50 per cent of total expenditure, was constraining funding to development programmes. The county also failed to meet the local revenue targets after it collected Sh1.52 billion in the period under review, a decline from Sh1.59 billion in 2014-15.

The controller of budget said the decline might further affect the budget implementation. The county spent Sh220.74 million on domestic and foreign travel compared to Sh197.30 million spent in a similar period in 2014-15, representing a 11.9 per cent increase.

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