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Economy

House team seeks budget cap for agencies with audit queries

PIC chairman Abdulswamad Nassir. FILE PHOTO | NMG
PIC chairman Abdulswamad Nassir. FILE PHOTO | NMG 

State corporations with pending audit queries will not be allowed to access certain percentage of their annual budget if MPs approve changes to the State Corporations Act.

The Public Investment Committee said it is drafting amendments to ensure that corporations do not undertake projects unless they have full budgetary allocations.

“The committee is drafting amendments to ensure that State corporations that have not cleared audit queries with National Assembly will not be allowed to use in excess of a certain percentage of their annual budget,” Mr Abdulswamad Nassir said

Instead the affected will only access money to pay salaries and facilitate movements, he said.

“We cannot have a situation where audit queries are recurring year in year out. We must ensure that if corporations want to get full budgetary allocation, only those with clean books will qualify,” Mr Nassir said after meeting with the management of the Geothermal Development Company (GDC) over its 2015/16 audit report.

He said several corporations were undertaking gigantic projects when they did not have money to complete them.

“They are forcing the Treasury to intervene and provide additional budgetary allocations. We want to tighten the law to ensure that unless the Treasury confirms funding for the entire project, they will not be allowed to undertake the project,” Mr Nassir.

The committee last evening scrutinised the vesting of geothermal wells that were developed by KenGen to the GDC.

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