CoB warns of graft surge in health, economic crises

By Lewis Njoka
Friday, March 26th, 2021
National Assembly Health Committee led by its chair Sabina Chege at KEMSA warehouse in Embakasi
In summary

Lewis Njoka @LewisNjoka

A surge in corruption is expected to depress Kenya’s economy further worsening growth in 2021 on the back of an estimated Sh560 billion virus inflicted erosion of gross domestic product (GDP) last year.

Controller of Budget (CoB) Margaret Nyakang’o says corrupt individuals are taking advantage of the current health and economic crises to engage in illicit deals, noting that many agencies used the Covid-19 pandemic to engage in discretionary expenditure.

“When the economy is stressed, as ours is right now, finance management cannot be done properly and is reduced to just cash flow management,” Nyakang’o said yesterday during a national taxpayers forum.“Whenever there is a crisis, there is likely to be corruption,” she added.

Amount of cash

With taxpayers estimated to have lost unknown amount of cash last year when Kenya Medical Supplies Authority (Kemsa) procured Covid-19 related items estimated at Sh7.8 billion without following the due process, fears abound that the third pandemic wave could signal another circle of looting.

The CoB who spoke when she attended a virtual conference on corruption organised by the National Taxpayers Association urged government agencies to uphold financial integrity as claims of plunder of taxpayers resources were unveiled.

“If you look at the issues being investigated by the Auditor General, I can tell you about 90 per cent relate to procurement,” said Sammy Kimunguyi, the deputy director of audit in the office of the Auditor General.

Reports released from the Auditor General in September last year showed that 23 ministry departments and agencies could not account for Sh16.6 billion expenditure in the financial year to June 2018.

The department and agencies failed to provide payment vouchers and records on receipt of delivered goods to support the expenditure.

While this does not necessarily mean the money was lost, it is good reason for taxpayers to get concerned.

Kisumu Town East Member of Parliament, Shakeel Shabbir called for the simplification of the country’s tax system saying the current one was complex, illogical and prone to corruption.

He said Kenya needs to do away with inefficient tax structures that have evolved over time entrenching corruption.

“Here, the taxman is considered someone you can buy. Does corruption slow down tax collection? Yes, it does,” Shabbir said.

He lamented the slow pace at which reports by the Auditor General are produced saying by the time a report is released the people involved have already covered the tracks.

Perceptions index

“Auditor General’s reports are historic. What are you going to do two years down the line,?” he posed.

He called for swift and decisive action against those implicated in corruption saying so doing would deter future incidences.

A 2019 Corruption Perceptions Index by Transparency International ranked Kenya position 137 out of 180 countries meaning the country still has a long way to go in curbing corruption.

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