Looting Nation

Money feared siphoned by faceless people who continue to be in office despite the damning revelations
Ministries have been flagged for questionable expenditure while government is yet to account for the Eurobond
For more than five years, the Auditor General Edward Ouko has been pointing out grey areas in how taxpayer’s money is spent by government agencies.
Although runaway corruption has become the norm over the past few years, the Sunday Standard has compiled, from Ouko’s report, the total amount of money suspected to have been lost to corruption over the years.

A crunching of numbers from the last five annual reports by the Auditor General’s office that either continue to gather dust in Parliament or are being ignored by investigative agencies show that taxpayers could be losing an average of Sh1 trillion every year.

ALSO READ: Parliament on the spot over justice to audit report

This means that in the last five years, Kenya could possibly have lost Sh5 trillion to corrupt individuals, cartels fueled by leaky government processes and an incorrigibly corrupt public service.

Government spending

During the five-year period of audit results, a total revenue of Sh4.82 trillion was collected. An analysis by Sunday Standardshows that only Sh590 billion of government expenditure has been properly accounted for, representing 13 per cent of total expenditure. A staggering Sh4.2 trillion, some 87 per cent, was either lost, not spent well or not accounted for.

Sh368 billion of the Sh1 trillion is spent without any accountability. Not even the chief government gate keeper can keep tabs on the hemorrhage of public funds.

To put the numbers into perspective, Sh368 billion is just Sh41 billion shy of what was spent to construct and buy locomotives for the first phase of the Standard Gauge Railway from Mombasa to Nairobi. It is also the amount of money that has cumulatively been lost by government in the last five years.

When put into context, the Sh368 billion lost can fund all the 47 counties in the current financial year, if you add just Sh4 billion, or better yet pay all the government employees if you add Sh48 billion to it.

Missing from this Sh368 billion is Sh215 billion from the controversial Eurobond, which remains unaccounted for three years later.

The matter was a hot political potato in the run up to the elections last year. The last time this matter was heard was when the Auditor General said he was going to send auditors to the US to investigate.

Still from the reports, some Sh12 billion collected from the public by various agencies in the audited five years has never made it to the Exchequer.
In 2015, Sh3.7 billion collected did not make it to Treasury. The previous year, Sh3.1 billion got lost between the various collection points and Treasury, while in 2013 Sh2.7 billion was pocketed by individuals. This trend replicates itself in all the audit reports analysed by Sunday Standard.

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On average, our analysis shows that only about 30 per cent of Kenya’s annual Budget which is now Sh3 trillion a year is spent and reported correctly. From the remainder, about 50 per cent is not accounted for correctly while the remaining 20 per cent is siphoned by faceless people who continue to be in office under unclear circumstances.

But even where there is some form of accounting of money spent, there is massive representation of numbers, repetitive non-remittance of revenue to the Exchequer by some agencies and bad accounting. So bad is the problem that the following two statements by the Auditor General have become a permanent fixture in his last five audits.

“There is weak and inadequate maintenance of accounting records across a number of Ministries and departments. A number of financial statements differed materially with the Ledgers and Trial Balances, from where ideally they ought to have been derived,” Ouko has said in a number of his reports.

“As such, we don’t know what each ministry or department owns and consequently the net worth of the Government of Kenya as a whole cannot be determined.”

The losses include by departments meant to be custodians of the law or public money such as the Treasury, Judiciary and even the Directorate of Criminal Investigations (DCI). To date, for instance, DCI owes the Exchequer Sh193,029,466 that it collected in the 2015/2016 financial year for issuance of 543,108 Police Clearance Certificates.

The clearance certificate, a crucial document for job seekers, costs Sh1,000 per application. The DCI received Sh543,108,000 but only said it received Sh350,078,533 “resulting in a loss of Sh193,029,467, which has not been explained or reconciled.”

Not acted upon

Yet every year, the National Audit Office continues to prepare such reports but they are not acted upon. MPs, who cost taxpayers Sh21 million each a year for representation, are supposed to be the first to act on the Auditor General’s reports, but continuously treat his findings casually.

ALSO READ: Parliament threatens action on CS Munyes

Edward Ouko, who has served as Auditor General since 2011, too, has in recent months toned down his abrasive nature that had before last year’s election earned him ‘enemy tag’ by State House. Jubilee MPs had plotted to remove him from his post, which is protected by the Constitution, immediately after winning a second term but they too have changed their minds.

“If we don’t watch out, it will engulf us,” the Auditor General told Reuters recently on the level of graft describing it as shocking.

Consequently, officials culpable for the graft continue to walk free while their counterparts have their days in court. It is this reality that is raising political temperatures, with some quarters openly saying that the reinvigorated war on corruption is targeted.

On Friday, when top officials from Kenya Pipeline Company (KPC) and the National Hospital Insurance Fund (NHIF) were arrested, Deputy President William Ruto asked institutions mandated to fight corruption to be objective and avoid being used to settle political scores.

“Let us not politicise matters to do with independent institutions of prosecutions and investigations. They must operate independently without instructions from anybody, without serving any partisan interests because that is how we are going to succeed,” he said in Elgeyo Marakwet.

But as the DP spoke, religious leaders called for a review of laws to make corruption a treasonable offence.

https://www.standardmedia.co.ke/business/article/2001305596/the-shame-of-sh1-trillion-queried-yearly-by-auditor/business/

Judiciary has failed …corrupt judges who postpone cases to infinity… But Uhuru appointing those named in corruption scandals and election loosers to offices also sends don’t care message…a case of him whining in public about the corrupt at the same time dinning with them behind the scenes

All this looting and we are still afloat, kuna mtu anadanganya the true size of this economy.

Niliwai soma sijua if ni hapa ndani ati Naija Leaders looted money meant to fight Boko haram… Soon or later we shall be there.

The Government in Kenya is the innocent mirror of the nation. The quality of government and its leaders, is simply a reflection of the collective consciousness of all the people in Kenya. In some instances, leaders who came to power as the champions of anti-corruption have themselves been charged with being involved with levels of corruption even more serious than those of their predecessors. If the collective consciousness in Kenya is disintegrated and negative, and people are not behaving in accord with Natural Law, then problems and corruption will be an unavoidable phenomenon of government. If, on the other hand, the collective consciousness in Kenya is positive, integrated, and coherent, then the government will not be influenced by any negativity. If the people in Kenya wish to be protected from corruption in government, then they must create an integrated collective consciousness. Positivity and harmony should be so strong and dense in national consciousness that negative influences cannot penetrate it

Edward Ouko cuts the image of a fearless auditor who would not spare even State House when it came to matters of public expenditure.

He never shies away from turning heavy stones to unearth financial scandals in Government that seem to permeate almost all agencies including the Presidency, Directorate of Criminal Investigations (DCI) and even the National Treasury, who are expected to lead by example.

Mr Ouko was still on this path when he found that the National Treasury could not satisfy him that the proceeds of the first Eurobond were brought into the country in full.

In his usual daredevil approach that has characterised his reign at Anniversary Towers, he sparked a national storm when he declared on Note 409 of his reservations in the audit report covering the 2014/2015 financial year.

The Auditor General said while following the trail of the proceeds of the billions Kenya had borrowed, he chose to sample a few ministries to establish if what officers from the National Treasury were saying was indeed true.

Guinea pig

He picked the State Department of Water as one of his guinea pigs. Here, he came face to face with his suspicions. The ministry had received Sh11.1 billion from the sovereign bond that year.

However, the management could not provide even just one project that was funded by the Eurobond proceeds.

“In the circumstance, it has not been possible to confirm how the Eurobond funds were utilised,” noted Ouko.

This was the start of his problems and perhaps one of the wires he should never have touched.

He would ignore indirect warnings sent to his office and his men and continue with his investigations. The following year, he stuck to his guns and continued his crusade against the pilferage.

“I wish to draw your attention to Note 5.7 in the statement of receipts into and issues from the National Exchequer Account for the year ended June 30, 2016 which reflects an Exchequer balance of Sh203,491,419 brought forward from 2014/2015 financial year,” wrote Ouko.

“As indicated in the Auditor’s Report for 2014/2015, the receipt of net proceeds from commercial financing (Sovereign/Euro Bond) of Sh215,469,626,036 accounted for in 2014/2015 financial year could not be ascertained as investigation into the receipts, issues, accounting and utilisation of the funds related to the Sovereign/Euro Bond was still on-going as at 30 June 2016.”

Doorstep

To keep the matter active, the Auditor General maintained his position on the matter, despite the pressure that was now mounting on his doorstep. He refused to clear the Eurobond query.

“Under the circumstances, the accuracy of the Exchequer balance of Sh203,491,419 brought forward from 2014/2015 may be affected by the outcome of the on-going special audit on Euro Bond,” he concluded.

That is not all. He decided that if the fovernment would not give him answers, then he would go seek them out himself.

He took another decisive step to send a team to New York and London to get assurance from all the banks that were involved in the transactions, including JP Morgan and the Federal Reserve Bank of New York.

This step was the last straw that broke the camel’s back.

President Uhuru Kenyatta would swear in his mother tongue that Ouko was wasting his time with the investigation and he would not allow him to keep poking his nose in places he should not.

It was clear the President wanted Ouko out of the scene, he had become a nuisance. An unnecessary thorn in the flesh. It was a big irony for a president elected on an anti-corruption platform to want to silence the only man who appeared to be working at the time. Uhuru would repeat the warning in State House - and this was the switch that Parliament was awaiting to jump into action.

A House heavily controlled by the Jubilee side was, like a fawning lapdog, charged with the duty of bringing Ouko down in a most shameless scheme.

A private petitioner was roped in with a claim that the Auditor General accumulated a Sh1million bill on his iPad while overseas, besides allocating official cars to members of his family. Ouko in his usual steely manner refused to take the beating lying down and sued both the President and Parliament. He submitted through his lawyer Otiende Amolo that Uhuru should not be allowed to sign a recommendation by the National Assembly to have a tribunal investigate him, a move that would have seen him step aside.

He termed the process rushed, malicious and intended to irreparably violate his fundamental rights and freedoms guaranteed under the Constitution. But by the time he was coming out of this storm, he was limping and brutally harassed. He retreated and went dead silent on the matter only promising that his report would be out first before the General Election, then after the polls - then nothing.

He also appears to have decided to break away from the tradition of passing on audit queries year in year out until they are resolved.

Instead, he dropped the query and never gave it a clean bill of health or otherwise, a neutral position adopted by auditors when they want to protect their jobs but at the same time not to clear books that do not add up.

Just what did Ouko find out that shut him up?

Ouko has survived all the tumult to unearth myriad financial scandals that have left the very president who wanted him sacked appearing helpless in the face of unprecedented theft by his appointees as borne out by his latest admission that stealing of public funds has become the vogue in Kenya, hence his decision to appoint 91-year-old Moody Awori to be in charge of the Sports Fund.

Prior to his appointment as Kenya’s Auditor General in 2011, Ouko worked with the African Development Bank where he directed and supervised audits, anti-corruption and fraud investigation for over 12 years.

https://www.standardmedia.co.ke/mobile/amp/article/2001305600/auditor-silenced-what-did-ouko-find-on-the-eurobond-investigations-that-shut-him-up

Huyu mtu akienda ndio tutajua if the fight on corruption was real. He’s the guy who provides information to the DCI and DPP. Without him there’d be no news on who’s looting where. I wonder if his successor will be as enthusiastic as he has been.

What’s use of exposing everything and every time hamna action is done…but I still salute his work despite all this…
Still on Auditor General
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Hii nchi iuzwe tu.

no one has clean hands in kenya, not even the clergy. so mtulie. we will be ruled by dragon people from China for 100 years, then the US, which has been using museveni like tissue paper will take over.
izo ndio consequences za Ujinga.

Sijasoma zaidi nilipofika hapa, pesa imeibiwa ndio, lakini hapa kuna hesabu haiingiani, smells like BS from where I am, all the money that was collected was looted?

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Fredrick sagwe not so long ago used to work at NHIF front desk with a salo of 50k… He now owns 4 houses worth 20m each.

Kwani hujui vile budget inakaa? Tax and parastatal revenue money collected in Kenya comes to about 0.8 to 1.8 trillion annually in the last 5 years, that’s what they mean by revenue, the rest are loans that the govt borrows to supplement the budget deficit.

Hapo anasema total revenue collected in 5 years was 4.82B and in those same 5 years close to 5B was looted… Hebu niambie anachomaanisha kama hio sio sensationalism kwa hio article.

The genius of the negro

Anamaanisha 4.82 trillion was the money collected. But that’s not the total expenditure. Since the govt always spends more than it collects, it borrows the rest. Ile eurobond Ilipotea was borrowed money. So it is possible to steal more than the govt collects.

Ok… Makes sense, but still hizo figure zimewekwa ni a bit over the board.

shilingi yaua tena ni maua

Sir, you can’t argue with these shits. One thing they don’t even know is that an audit query is NOT the same as funds being stolen. For example, if a ministry bought computers for Sh300 million and the delivery note was missing, the auditor will flag that contract.

This guys don’t even know that HALF of all the money collected by GoK is used to pay salaries…

To them civil servants are thieves and unqualified …everything they see is through this shear

Hapo sasa!!!