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The National Assembly Public Accounts Committee (PAC) has uncovered a fraud scheme involving state and public servants accused of defrauding taxpayers through the misuse of daily subsistence allowances and imprest payments.
During a review of the financial accounts of the State Department of Shipping and Maritime Affairs for the year ending June 30th, 2022, the committee identified significant discrepancies in payment vouchers and the accuracy of the imprest register.
An analysis of payments made for recurrent cashbook items during the year revealed that Ksh 28 million had been paid to staff for domestic travel and allowances.
According to Auditor General Nancy Gathungu, the amount paid suggests that officers were in the field for more days than their work schedules could realistically accommodate, casting doubt on the legitimacy of the Ksh 28 million in payments.
“This report covers the entire financial year and clearly shows that the payments made to the officers exceeded the actual number of days they worked,” stated Principal Secretary for Shipping and Maritime Affairs, Geoffrey Kaituko.
“This suggests they were paid for more days than they actually served, possibly amounting to more than a year’s worth of payments,” admitted PS Kaituko.
Rarieda MP, Hon. Otiende Amollo, pressed for clarity, asking, “Are you agreeing with the Auditor General’s findings? It seems your response contradicts the Auditor General’s statement—would you like to correct it?”
“In very polite terms, the Auditor General is essentially stating that these claims were fraudulent. When they mention that the number of days claimed exceeds what was possible, they are indicating fraud. Aren’t we seeing fraud here?” added Amollo, who is also a Senior Counsel.
PS Kaituko responded, “Perhaps we will need to retrieve the vouchers themselves, not just the samples here. We likely need a week to gather that information and present it to the committee.”
Mr. Kaituko clarified that the Ksh 28 million in question was related to daily subsistence allowances and standing imprest payments. He explained that Ksh 14.2 million was issued to officers conducting various activities across counties in the Maritime Domain.
“Ksh 11.7 million was paid to officers carrying out field activities, while Ksh 2.1 million was allocated for tea and other office operations,” the PS explained.
Soy MP Hon. David Kiplagat emphasized the need for a proper distinction between imprest, claims, and per diems during the audit process.
“We need to know if the head of accounts can differentiate between imprest, claims, and per diems, especially in cases where significant amounts, like Ksh 2 million, are allocated for questionable purposes such as sending people to look for tea in the streets,” said Hon. Kiplagat.
The Soy lawmaker alluded to a pattern of repeated issues, suggesting a possible loophole within the system being exploited.
“There seems to be something suspicious happening within that loophole. It’s not that we expected the person to cancel and repeat transactions, but rather that there is likely a flaw in the system, and something questionable is taking place within that loophole,” he observed.
He called for a forensic audit to investigate the cause of these repetitive errors and to uncover what is really happening.
Butere MP, Hon. Tindi Mwale, who chaired the session, further questioned the legitimacy of the samples used to justify payments, suggesting they were insufficient and potentially fraudulent.
He highlighted specific entries where officers appeared to receive and surrender the same amount multiple times, indicating possible system errors or misuse.
Hon. Mwale challenged the head of accounts to explain these inconsistencies and called for a forensic audit to uncover the root cause of these recurring issues.
“We need public officers who are more sincere—those who won’t come and defend mistakes that are clearly evident to everyone,” urged Hon. Mwale.
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