Solution to the Rampant Cases of Corruption in Public Sector

Solution to the Rampant Cases of Corruption in Public Sector 

A former US Statesman, Adlai Stephenson opined that: ‘Politicians approach issues with open mouth rather than with open mind’. Indeed, politicians are purveyors of politics, and to them politics cannot thrive in objective openness and on high moral ground. No doubt, Kenyan politicians are not any different from all ot

Mfalme Davis

hers the world over, and Stephenson could as well have been speaking of them as well.

Before the promulgation of the new Constitution of Kenya on August 27th, 2010, any average Kenyan would have been forgiven for concluding that the rampant corruption in the public sector is resultant of failure of government to tame it.

We learnt in civics lessons at lower primary school that there are three arms of government, i.e. the legislative, the executive and the judiciary. The Legislative makes laws, the Executive makes public policies and implements them, and the Judiciary interprets the law and its prescriptions.

In economics, perhaps there is nothing sinister about the term ‘corruption’ if this involves moving the resources from low productive sector to a high-yielding sector of economy. In law, the term corruption in the public sector is nothing but deodorized euphemism for actionable fraud where crafty fraudsters seek to defraud the public coffers for their own benefit and not for public good.

I used the word deodorized rather sarcastically because I know only too that politicians deliberately chose to equate corruption with ‘looting’ and ‘grabbing’ of public resources and public property – in a free-for-all scenario, and where only the initiated thrive and the losers relegated to whistle-blowing.

For elected leaders, looting involves helping themselves with public funds like CDF as ‘honorarium’, and ‘grabbing’ involves alienating public property for themselves for better us, and ‘embezzling’ involves sharing the loot among their associates.

MPs loot CDF, Governors embezzle county revenue and politicians grab public land with abandon. The anti-corruption agency should be the complainant in cases of looting, and the National Land Commission should be the complainant in cases of grabbing of public land.    

Rather fortunately for the citizenry, the learned drafters of the constitution thankfully devoted a whole Chapter Twelve aptly headed,’ PUBLIC FINANCE’ which runs from Part 1-Part 6. Article 228 enjoins Parliament to enact an Act of Parliament that provides for the establishment, functions and responsibilities of the National Treasury (to be headed by the Cabinet Secretary for Treasury….emphasis mine).

Article 225 (2) enjoins Parliament to enact legislation to ensure both expenditure control and transparency in all governments, and establish mechanisms to ensure their implementation. Clause (3) states that:’ legislation under clause 2 may authorize the Cabinet Secretary responsible for finance to stop the transfer of funds to a State organ or any other public entity—

    (a)Only for a serious material breach or persistent material breaches of measures under that legislation; and

    (b)   Subject to the requirements of clause (4) to clause (7) respecting a decision to stop transfer of funds under clause (3) whereby this may stop the transfer of not more than fifty per cent of funds due to a county, the requirement not to stop the transfer of funds for more than sixty days, and its immediate enforcement, but lapsing retrogressively unless, within thirty days after the date of the decision, Parliament approves it by resolution passed by both Houses.

Clause (6) states that: ‘Parliament may renew a decision to stop the transfer of funds but not more than Sixty days at a time. And clause (7) adds that: ‘Parliament may not approve or renew a decision to stop the transfer of funds unless—

(a)  The Controller of Budget has presented a report on the matter to Parliament; and

(b) The public entity has been given an opportunity to answer the allegation against it, and to state its case before the relevant parliamentary committees.

Article 226 (1) respecting accounts and audit of public entities, envisages an Act of Parliament that shall provide for –

(a)  The keeping of financial records and the auditing of accounts of all governments and other public entities, and prescribe other measures for securing efficient and transparent fiscal management, and

(b) Designating of an accounting officer in every public entity at the national and county level of government.  

Clause (2) states that: ‘The accounting officer of a national public entity is accountable to the National Assembly for its financial management, and the accounting officer of a county public entity is accountable to the County Assembly for its financial management.

Clause (3) states that: ‘Subject to clause (4), the accounts of all governments and State organs shall be audited by the Auditor-General. Clause (4) states that:’ The accounts of the Auditor-General shall be audited and reported by a professionally qualified accountant appointed by the National Assembly. Clause (5) captures the letter and spirit of the entire Chapter Twelve upon stipulating that: ‘If the holder of a public office, including a political office, directs or approves the use of public funds contrary to law or instructions, the person is liable for any loss arising from that use and shall make good the loss whether the person remains the holder of the office or not.

Article 227 (2) respecting Procurement of public goods and services, contemplates an Act of Parliament that shall prescribe a framework within which policies relating to procurement and assets disposal shall be implemented, and may provide for all or any of the following—

(a)  Categories of preference in the allocation of contracts;

(b) The protection or advancement of persons, categories of persons or groups previously disadvantaged by unfair competition or discrimination;

(c)  Sanctions against contractors that have not performed according to professionally regulated procedures, contractual agreements or legislation; and

(d) Sanctions against persons who have defaulted on their tax obligations, or have been guilty of corrupt practices or serious violations of fair employment laws and practices.

Article 228 (1), establishes the office of Controller of Budget, who shall be nominated by the President, and, with the approval of the National Assembly, appointed by the President. Clause (2) states that: ‘To be qualified to be controller, a person shall have extensive knowledge of public finance or at least ten years experience in auditing or public financial management.

Clause (4) states that: ‘The Controller of Budget  shall oversee the implementation of the budgets of the national and county governments by authorizing  withdrawals from public funds under Articles 204, 206,and 207, namely, Equalization Fund, Consolidated Fund and other public funds, and Revenue Funds of county governments.

Clause (5) states that: ‘The Controller of Budget shall not approve any withdrawal from public funds unless he is satisfied that the withdrawal is authorized by law. Clause (6) states that: ‘Every four months, the Controller shall submit to each House of Parliament a report on the implementation of the budgets of the national and county governments.

Article 229 (1) establishes the office of the Auditor-General who shall be nominated by the President and, with the approval of the National Assembly, appointed by the President. The Auditor-General is required to have the same qualifications as the Controller of Budget i.e. having extensive knowledge of auditing or public finance management.

Clause (4) requires that: ‘Within Six months after the end of each financial year, the Auditor-General shall audit and report in respect of that financial year, on—

(a)  The accounts of all funds and authorities of the national and county governments;

(b) The accounts of all courts 

(c)  The accounts of every commission and independent offices established by this Constitution;

(d) The accounts of the National Assembly, the Senate and County Assemblies;

(e)  The accounts of political parties funded from public funds;

(f)   The public debts; and

(g)  The accounts of any other entity that legislation requires the Auditor-General to audit.

Clause (5) states that: ‘The Auditor-General may audit and report on the accounts of any entity that is funded from public funds. Clause (6) states that: ‘An audit report shall confirm whether or not public money has been applied lawfully and in effective way.

Clause (7) requires that: ‘Audit reports shall be submitted to Parliament or the relevant county assembly. Clause (8) requires that: ‘Within three months after receiving an audit report Parliament or county assembly shall debate and consider the report and take appropriate action.

Fair Comments:

It is instructive that the legislations contemplated under Article 226 (1), and 227 (2),are now in force as Public Management Act, Public Procurement and Disposal Act ,2015,and Regulations of 2013, the County Government Act, 2012 and Anti-corruption Act.

Thus, reading Articles 225, respecting financial control, together with Article 227, respecting procurement of public goods and services, it is quite apparent that the Cabinet Secretary responsible for finance, the Controller of Budget and the accounting officers at both national and county levels, collectively should be held accountable for any irregularity in the management of public funds or breaches of the law applicable.

The accounting officers of the national public entity and the accounting officer of a county public entity are enjoined to run an efficient financial management system at their respective stations through Integrated Financial Management Information System (IFMIS).

It is the duty of the Controller of Budget to oversee the implementation of the budgets of the national and county governments by authorizing withdrawals from public funds, whereby he is enjoined not to approve any withdrawal from public funds unless satisfied that the withdrawal is authorized by law.

Through an efficient IFMIS, the Controller should be able to detect any irregularity or breaches of the regulations perpetrated by the accounting officers, and capture the same in his quarterly reports for submission to each House of Parliament. In the same breathe, he is also enjoined to duly inform the Cabinet Secretary for Treasury in time for him to stop the transfer of public funds.

Principles of public finance require that public money be used in a prudent and responsible way, and that financial management shall be responsible, and fiscal reporting shall be clear.

If the holder of a public office, including a political office, directs or approves the use of public funds contrary to the law or instructions, the person is liable for any loss arising from that use and shall make good the loss, whether the person remains the holder of office or not.

If the Cabinet Secretary for finance and the Controller of Budget fail or refuse to exercise due diligence in performance of their duties, the two appointees should be made to suffer under pain of the law and contempt thereof, and subjected to public vetting for contravening the Constitution as the supreme law of the republic.

In the event of acts of corruption, Controller of Budget should bear the hugest responsibility if he approves withdrawal from public funds which is not authorized by law.

Again, if public money are embezzled after approval for a lawful purpose, the accounting officer should bear responsibility and make good the loss, and the Anti-corruption agency should come in to recover the loss pursuant to the provisions of Article 226 clause (5) of the Constitution of Kenya. 

Useful Link: 
https://share.payoneer.com/nav/XGfiJPcAzQDareLavHQEabz5OvU32TOMHhV0jij4brqEioO6mAX4rdbnSxskDgDvCg-ek60CEheKuf8W2jw2