Accounting officers in government ministries, parastatals, and county finance officers will take personal responsibility for the non-performance of contractors, as MPs have proposed as part of a new strategy to tame growing numbers of stalled public projects.
The Public Accounts Committee (PAC) of the National Assembly says a public entity’s accounting officer should be responsible if a contractor they approved to undertake a project fails to deliver. The recommendation comes when projects valued at billions of shillings have stalled.
PSs and chief executives are the accounting officers in ministries and parastatals, respectively.
“Accounting Officers are further warned of personal responsibility should contractors fail to perform, considering the evaluation of the technical and financial capacity of bidders is mandated under the law,” PAC says in a report on examination of national government audits for 2020/21.
PAC’s report, which was tabled before Parliament end of February noted that by approving contractors of different projects, the accounting officers assume responsibility for their performance or non-performance.
“The failure to enforce and/or recall performance guarantees will also be personally remedied by the accounting officers,” said the PAC.
The report captured projects being undertaken by ministries, departments, and agencies.
“The committee encountered cases where some construction projects took inordinately long to complete for various reasons, including contractor non-performance, late exchequer issuance, budget cuts, and general poor foresight and project management. This led to sunk costs and a general lack of value for money, and in certain cases, interest charged by contractors,” it said.
The Auditor-General has been pushing for accounting officers to be held responsible for offences and irregularities in public finance management within their departments.
Treasury in the 2024 Budget Policy Statement (BPS) expressed concerns over the government’s exposure to stalled projects, directing ministries to finalize ongoing projects before commencing new projects.
“The Government will continue to strengthen the institutional framework for road development in order to accelerate the speed of completion of new and stalled road construction projects to cater for the growing population. In order to minimise waste of resources, the Government will ensure all projects are completed within two years and no new project will be launched before the ongoing ones are complete,” the BPS said regarding stalled road projects.
PAC recommended that the Treasury should only approve projects that can guarantee funding and completion within the medium-term economic framework.
“No new project should be commenced by an agency before all existing ones are completed or fully funded,” it stated.
