In his audit report for the 2017/18 financial year, the Controller and Auditor General (CAG), Prof Mussa Assad, revealed that local government authorities (LGAs) returned Sh335.41 billion to the Treasury.
At first glance, one would be forgiven to think that the returned funds were savings by LGAs resulting from sheer diligence in prudently applying government budget allocations to developmental socio-economic needs of the communities under their respective jurisdiction.
The bitter truth is that the funds were returned to the central government because the local government authorities miserably failed to use the money as budgeted and intended in starting new development projects, or completing ones which were started in past financial years.
For example, the implementation of long-term capital development projects (CDPs) aimed at securing the revenue base for most local government councils were the most adversely affected. In the event, more than Sh261.4 billion – that is 33 per cent of the total allocated funds – was not utilized as budgeted.
As the CAG report states, LGAs’ capacity to utilize budgeted funds which were disbursed to them for capital development projects in the 2016/17 and 2017/18 financial years was only 67 per cent. In that regard, the government auditor draws the conclusion that “the unspent balance at the end of the financial year implies a slow pace in implementing capital development projects”.
Sh146.18bn not used for planned projects
Furthermore, about 51 per cent of the Sh146.18 billion released by the national Treasury for the implementation of local government development projects was not used for the planned projects.
Indeed, only Sh72.28 billion of the sum had been spent as budgeted by June 30, 2018 – the end of the 2017/18 financial year – leaving unspent in the LGA kitty the goodly sum of Sh73.9 billion!
According to the CAG audit findings – and as reported in these pages last Friday – “local government authorities across the country are saddled with unfinished development projects. This is mostly due to poor planning and inefficiencies in funds utilisation”. But, local government authorities are not to be entirely blamed alone for this serious lapse that borders on criminality.
The central government is also culpable in this. This is if only because the national Treasury and related institutions of the central government fail – for some reason or other – to disburse in full and on time funds budgeted by the Union Parliament to the intended institutions.
This highly unsatisfactory situation of stalled development projects – indeed not only at the local government level, but also at the central government level and elsewhere – must be sharply brought to an end sooner than later.
To that end strategies must be put to ensure that public projects at all administrative levels across the country are no longer stalled only for reasons of poor planning, inefficiencies in funds utilization, late/delayed or partial disbursements by the Treasury, or whatever. We must curtail the stalling of development projects, and also effectively tackle head-on the causes to prevent recurrence of the setbacks.