Report faults Sh20bn spending by Nairobi County

What you need to know:

  • The county also has over 16,000 employees, 11,300 of whom were inherited from the defunct Nairobi City Council.
  • The report claims that the county is still hiring new workers despite committing to austerity measures in the 2015.

Nairobi County is spending its revenue directly when it comes in without first remitting it to the County Revenue Fund as is required by the law, a report by the Institute for Social Accountability has shown.

The report released on Monday shows that in three financial years, City Hall collected and spent close to Sh20 billion before remitting it for expenditure approval.

“In a clear contravention of the law, the county is spending over 70 per cent of the revenue it collects annually on recurrent expenditure with personnel emolument accounting for 60.17 per cent on average across the three financial years under assessment leaving very little for development spending.

“The continued expenditure of billions collected as revenue at source, does not bode well with the law and the practices of prudent and accountable financial management. That the same has consistently arisen is not only a pointer to financial malpractice but also financial impunity,” the report stated.

The 2015 County Government Public Finance Management Regulations states that only 35 per cent of the total revenue should be spent on salaries.

The county's huge recurrent expenditure has been attributed to a bloated workforce as casual workers and outsourced contractors are paid to offer the same services.

The county also has over 16,000 employees, 11,300 of whom were inherited from the defunct Nairobi City Council.

The report claims that the county is still hiring new workers despite committing to austerity measures in the 2015 County Budget Review and Outlook Paper agreement.

The report further revealed that Nairobi County incurred a debt of Sh3.2 billion in a span of six months between June 30 and December 31, 2015.

“There is need for a comprehensive debt policy across the 47 counties and not only in Nairobi County. A debt policy improves the quality of decisions, provides justification for the structure of debt issuance, identifies policy goals and demonstrates a commitment to long-term financial planning,” the report recommended.