Ideas & Debate

Problems with financial accountability in counties


Guests listen to President Uhuru Kenyatta during this year’s devolution conference, in Nakuru County in March. There has been poor financial accountability among the 47 devolved units. photo | Samuel Miring’u

The management of public funds is an issue the Kenyan populace is passionate about. However, the conversation on financial accountability in Kenya tends to be focused on National Government only. While this is right and warranted, Kenyans ought to extend the scrutiny on the accounting of public finances to county governments as well.

One of the main purposes of devolution was to bring public finances closer to citizens in a manner that would allow them to have a say on how county budgets were planned for and used. This does not seem to be happening.

As research firm Inaternational Budget Partnership (IBP) points out, the Constitution and the 2012 Public Finance Management Act (PFMA) require each of Kenya’s 47 counties to publish information during the formulation, approval, implementation and audit stages of the budget cycle.

In February IBP assessed documents related to budget estimates and implementation by county governments that were meant to be produced and made available on their websites between July and December 2016.

IBP found that only two counties (Elgeyo Marakwet and Siaya) had approved budget estimate documents available online. In terms of budget implementation documents, IBP found again, only two counties (Baringo and Kirinyaga) had published their first quarter implementation reports for 2016/17 online.

The dearth of information on budgets by county governments is worrying due to several reasons.

Firstly, citizens cannot be sure of how public funds are being planned for and used. The lack of budget estimates and implementation documents means that not only do citizens not know how county governments stated they would use funds, they also do not know how they actually used the funds.

The lack of both budget estimates and implementation documents means that citizens cannot hold county governments financially accountable; there is no documentation against which accountability can be gauged.

Secondly, although the lack of information does not automatically mean funds are being embezzled, the lack of budget reporting facilitates encourages embezzlement. The fact that most county governments are not accounting for funds, as per the PFMA, provides leeway for unauthorised spending.

So why aren’t county governments publishing budget related documents? The first issue could be capacity. In work I have done on county governments, it is clear that there are massive capacity constraints.

Does every county government have competent and well-staffed financial management staff and systems? If not, this constraint should be communicated by county governments so that remedial action can be taken.

Obviously the second reason is because they enjoy the lack of scrutiny as it allows ‘flexibility’ in the use of public funds.

As Kenyans gear up for elections in August, they should demand considerable improvements in the accounting of public funds by their respective county governments.

Aspirants should be taken to task on how they will ensure that the citizenry is fully aware of budget use and that all documents are made public within the stipulated timelines.