PSs, parastatal chiefs risk fines for stalled projects

Lawmakers want principal secretaries and parastatal chiefs who introduce projects before completing existing ones penalised after their push for funds for a special audit on incomplete public projects hit a snag.

The Budget and Appropriation Committee of the National Assembly says stalled public projects have “become a special feature in our budget”, exerting funding pressures and racking up pending bills.

 “There’s no adherence to the project guidelines issued by the National Treasury including the introduction of new projects before completion of existing ones despite thin spread of resources,” the parliamentary committee, chaired by Kanini Kega (Kieni), recommended in its report on the 2021/22 Budget.

“A policy must be implemented to ensure enforcement of PFM (Public Finance Act) and Treasury guidelines. Sanctions should be instituted to MDAs (ministries, departments and agencies) that introduce new projects before completion of existing ones.”

Stock-taking

 The Treasury has done a nationwide stock-taking of all public projects for an analysis aimed at identifying those that qualify for “re-appraisal, re-prioritization, and rationalization”, according to the Budget Policy Statement (BPS) 2021 published in February.

 This came on the back of a 2019 World Bank review of Kenya public expenditure, which suggested that 522 projects worth Sh1.1 trillion out of 3,972 projects in the country at the time were significantly delayed, incomplete or stalled.

In an earlier report on fiscal 2020/2021, the legislators had asked the Treasury to request Auditor-General Nancy Gathungu to conduct an audit on projects whose funding had been affected by budget cuts as a result of shortfalls in revenue due to the Covid-19 pandemic.

 The audit was to be completed by April 2021 with a view to providing funds for completion of viable projects in the financial year starting July to avert further increase in incomplete projects.

 “Auditing of projects affected by budget cuts by the Auditor General requires enhancement of the operations of the Office of the Auditor General,” the Treasury wrote in supporting information for the Budget Estimates for the fiscal year 2021/22 submitted to the House on April 29.

 “This will be considered in the context of the FY 2020/21 Supplementary Estimates No.2 and the FY 2021/22 Budget.”