Counties disregard SRC directive, spend millions on official housing

County governments continue to spend millions on rent for the official residences of governors and deputy governors in disregard of a directive by the Salaries and Remuneration Commission (SRC).

According to Auditor General Nancy Gathungu, several counties are yet to adhere to the directive by SRC.

This has come to the fore through Gathungu’s latest report capturing the 2022/2023 financial year on counties which indicates that some governors and their deputies continue to earn housing allowances.

In other counties, the expenditure on the construction of official residences has exceeded the ceiling set, while others have stalled despite consuming millions of taxpayer money.

On March 1, 2013, SRC in a gazette notice, had advised that the government should provide official residence for the President, the Chief Justice, the Governors, and Speakers of both the national and county assemblies.

.

Keep Reading business

•  Scientists root for genome editing to boost food security
•  TVETs to get Sh49 million funding for tech training
•  Amsons' bid for Bamburi Cement gets Comesa approval
•  Co-op Bank third-quarter profit jumps to Sh19b on higher income
•  I am not about to retire, Equity's James Mwangi says Premium

The Commission advised that the benefit would not be provided in the form of house allowances but as a housing benefit.

Similarly, on May 20, 2019, SRC issued a circular to all county secretaries and clerks of county assemblies, in which SRC said the deadline for county governments to pay rent for select officials had been extended to June 30, 2022.

The extension was to allow those counties that had not started the construction of the houses time to allocate funds and prioritise construction.

SRC said counties should construct the houses on public land owned by the respective counties.

In the specifications set by SRC, the acreage limits for the construction of the houses for the governor were to be up to two acres and up to one acre for the deputy governor and county assembly speaker.

Costs capped

In capping the cost, SRC said the cost of constructing houses for the governor, deputy governor, and county assembly speaker was at Sh45 million, Sh40 million and Sh35 million.

SRC directed each county to furnish the commission with the status of its implementation of the housing benefit for the affected state officers, within an interval period of six months.

On August 14, 2020, SRC in another circular and in reference to the May 20, 2019 circular, said it reviewed the content of the letter on Housing Benefits for governors, deputy governors, and county assembly speakers.

SRC reiterated the June 30, 2022 deadline for leasing houses still applies.

The counties were reminded to hasten the construction of the houses by allocating funds and prioritising the construction.

Today, however, most counties are still yet to make significant progress in constructing the houses while the projects in some have stalled.

In Embu, the auditor noted that the construction of the governor’s official residence has stalled.

A contract for the construction of the governor’s residence, she said, was awarded on March 8, 2021, at a contract sum of Sh49.7 million.

The contract period was 72 weeks with an expected completion date of September 8, 2022.

“According to the Salaries and Remuneration Commission Circular Ref. No. SRC/TS/COG/6/61/48 VOL.II (64) of 20 May 2019, the County Executive was required to allocate funds and prioritise the construction of houses for the Governor and Deputy Governor on public land.

Certificate of work

“However, at the time of audit in August 2023, the Governor’s official residence was incomplete and the last certificate of work done revealed that the project was 55 per cent complete,” read the report in part.

In Turkana, the auditor said the contract for the construction of the governor’s residence was awarded in the Financial Year 2013/2014.

The contract was, however, terminated in the financial year 2014/2015 when the contractor had been paid Sh120.2 million.

The audit revealed that a new contract was awarded on April 24, 2019, at a sum of Sh90.5 million for 52 weeks ending October 31, 2021.

The Auditor General noted that the expenditure incurred by Turkana County Government to date exceeds the limit of Sh45 million limit SRC for a Governor’s residence.

Further, purchase orders amounting to Sh14.5 million the audit revealed were issued after the expiry of the contract period and the performance bond.

“Project inspection on 14 November 2023 revealed that the project was incomplete and the contractor was not on site.

“The Governor and his Deputy irregularly earned Sh2.2 million as housing allowance after the period for such allowance being paid of 30 June 2022 had passed,” read the report.

Samburu County, audit revealed, had not allocated funds for the construction of the construction of deputy governor’s official residence.

The report revealed that on January 17, 2022, the contract for the construction of the Governor’s official residence in Samburu was awarded at a contract sum of Sh87.5 million which was Sh42.5 million above the ceiling of Sh45 million set by SRC.

The audit also noted the delay in the construction of the Governor’s office in Nandi.

The report revealed that the County Government contracted a construction company to construct the Governor’s office but the contract was terminated.

The report revealed that the contractor was paid an amount of Sh10.9 million during the year under review.

Further review of records revealed that after the termination of the initial contract, the County Government entered into the second contract on September 8, 2021, at a contract sum of Sh45,847,895.

A physical inspection conducted in August 2023 revealed that the contractor was on site and the project was incomplete.

Baringo County Executive, the audit revealed, incurred an expenditure amounting to Sh1,080,000 on rent for the residence of the Deputy Governor.

In addition, a budgetary allocation of Sh15 million for the construction of the Governor’s and Deputy Governor’s residences was reallocated in the second supplementary budget.

The construction for Bomet Governor’s residence the report revealed had stalled.

The county it was noted had entered into a contract with a local contractor for the construction of the house at a sum of Sh78 million.

The contract period was two and a half years starting January 31, 2019, when the contractor took possession of the project site with a completion date of June 30, 2021.

The contract period was extended to June 30, 2022, with the contractor on December 14, 2022, requesting another extension of the contract period from December 30, 2022, to June 30, 2023, but the approval of the second extension was not supported.

The audit revealed that physical verification of the project in August 2023 was incomplete twenty-six (26) months after the estimated completion date of June 30, 2021, and the contractor was not on site.

In Vihiga, the audit noted a delay in the construction of the Governor’s and the Deputy Governor’s residence despite a Sh35.9 million payment.