Auditor-General Nancy Gathungu now wants the Ethics and Anti-Corruption Commission (EACC) to investigate the management of Moi Teaching and Referral Hospital (MTRH) over irregular utilization of Sh115 million meant for Covid-19 intervention.
The failure by MTRH to account for the funds disbursed by the national government is a glaring violation of the Public Finance Management (Act), which Ms Gathungu has flagged in a special audit on the utilization of the Covid-19 funds.
“It is recommended that further investigations should be conducted on utilization of the funds to establish any criminal activities,” the special audit report says noting that the expenditures were not backed by relevant documentation like the payment vouchers.
The special audit covered the period March 13, 2020, the first Covid-19 case was first reported in the country and July 31, 2020.
The audit shows that for the period under review, MTRH received Sh764.5 million, which is part of the over Sh214.92 billion that the national government procured in form of loans from the development partners to help in the fight against Covid-19.
The funds were received in a special deposit account held at the Central Bank of Kenya (CBK).
The funds to MTRH were disbursed in two batches- Sh85 million for the 2019/20 and Sh30 million for the 2020/21 financial years.
MTRH Chief Executive Officer Dr Wilson Aruasa, while appearing before the Public Accounts Committee (PAC) of the National Assembly that is considering the special audit report, could not explain how the funds were used.
Irregular payments
This is notwithstanding that the hospital management irregularly paid Sh2.7 million health workers’ allowance to non-eligible staff against the circular of the Salaries and Remuneration Commission (SRC).
The audit further shows that Sh1.1 million was recorded as overpayment of frontline workers allowance, which exceeded the SRC recommendations.
“Under the circumstances, the special audit could not confirm the lawfulness and effectiveness of the amount incurred by MTRH,” the special audit says.
But Dr Aruasa, the hospital’s accounting officer, faulted the audit report saying that the expenditure was within the law.
“MTRH would like to clarify that the amount allocated in the two financial years was utilized as per the budget, work plans and procurement plans,” Dr Aruasa told PAC, a watchdog committee that is chaired by Ugunja MP Opiyo Wandayi.
Auditors attached to PAC, however, faulted Dr Aruasa for failing to provide the work plans at the time of audit.
“We did not get the necessary documentation to support the payment of Sh115 million. The CEO did not produce payment vouchers to support the expenditure. He only provided a spreadsheet,” the auditors told the committee, an indication the funds may have not been used for the intended purpose.
The National Treasury has also faulted MTRH for not coming out to explain how the Covid-19 funds it was allocated were used.
Health workers allowance
“The spreadsheet that the MTRH CEO has provided to this committee to justify the expenditure is inadmissible in accounting terms,” the National Treasury official attached to PAC, said.
Dr Aruasa however, told the committee those paid the health workers allowance were eligible.
Among those listed as having received the health workers allowance include support staff from the ICT staff, procurement, finance and administration departments.
“In our opinion and based on the SRC circular, these are not frontline workers. The circular from SRC was specific that only frontline workers be paid the allowance,” said the auditors.
Mr Wandayi reminded Dr Aruasa that in matters remuneration of public officers, SRC is the final authority.
“How did you pay the allowance to people outside the SRC circular? You trashed what you had been advised to do by a relevant government agency, in this case SRC, and you still want this committee to believe you! It does not work that way. You are not law unto yourself,” warned Mr Wandayi.
But Dr Aruasa held on.
“You cannot tell me that my procurement officer is not a frontline worker. It’s approved in our human resource policy and procedure manual that support staff are frontline workers,” retorted Dr Aruasa.
The PFM Act regulation, 2015 provides that except as provided for in the Act and the regulations, an accounting officer of an entity may not authorize payment to be made out of funds earmarked for specific activities for purposes other than those activities.
It further provides that a public officer who makes a payment contrary to the law as established, commits an offence under the Act. BY DAILY NATION