Lawmakers cast doubt on Barchok’s Helb loans deal

Bomet Governor Hillary Barchok

Governor Hillary Barchok appears before members of the Senate Committee on County Public Investments and Special Funds at the KICC in Nairobi in mid April.

Photo credit: Lucy Wanjiru | Nation Media Group

Senators have put Governor Hillary Barchok on the spot over a Sh9.7 million student loans deal with the Higher Education Loans Board (Helb).

The county government signed a deal with Helb and has been channelling funds to the agency despite lacking an approved budget for the programme.

 The Barchok administration paid Sh9.7 million to Helb as loans to students under the Bomet County Education Revolving Fund.

Helb, however, only disbursed Sh7.57 million with the governor failing to explain the whereabouts of the remaining Sh2.24 million.

This emerged during hearing of a Senate watchdog committee that is considering audit queries raise regarding the Bomet County Bursary Fund and the Bomet County Education Revolving Fund for the financial year ended June 2022.

The County Public Investments and Special Funds Committee questioned why the county government irregularly signed the deal after Auditor-General Nancy Gathungu flagged the expenditure, stating that the county had not supported the transfer of the Sh9.7 million to Helb.

Losing millions

According to the audit report, a list of names, admission numbers and amounts awarded to each student was not provided for audit.

The report pointed out that the county government risks losing millions in the arrangement as the beneficiaries were not repaying the loans.

The committee that is chaired by Vihiga Senator Godfrey Osotsi directed the governor to ensure that the legal framework governing the management of the fund is regularised in line with the Helb Act and the Public Finance Management (County Governments) Regulations, 2015.

Appearing before the committee, Governor Barchok said the county had not provided all the supporting documents during the time of the audit as it had not received the schedules from Helb.

He told the committee that Helb is the custodian of details of repayments and is fully in charge of recoveries. He added that all loan schedules disbursed during the financial year have been received and provided.

“The committee directs the governor to ensure that the fund administrator submits to the Committee, statements as evidence that the Sh2.24 million is still being held by Helb,” Mr Osotsi said.

The anomalies did not end there as the audit report further revealed that the budget for the fund's vote was not captured in the county’s financial statements.

However, the governor said the Funds has a dedicated budget and that it was an omission in the financial statement.

Approved budget

But the committee maintained that the funds did not have an approved budget, contrary to the governor’s submission.

Mr Osotsi ordered Mr Barchok to ensure that the funds' administrators prepares and submits a budget for approval.

On the Bomet County Bursary Fund, the committee directed the governor to provide a schedule of disbursement of the funds within seven days.

This is after the auditor’s report cast doubt on the expenditure as the county did not provide a list of beneficiaries and other crucial supporting documents.

The committee noted that the county operated the Fund using commercial bank accounts instead of having an account at the Central Bank of Kenya in line with the law.