By Martin Masai

THE Machakos County Government has a record 225 bank accounts. According to records at the Office of the Auditor General, only 18 bank accounts, with Kes.1.9 billion, have been revealed. Yet records at the AOG’s office reveal further that 245 bank accounts with a balance of Kes.225 million were not disclosed in the financial statements of the County Government of Machakos for 2022/2023.

These revelations were made during the appearance of Governor Wavinya Ndeti before the Senate’s Public Accounts Committee. Committee Chairman Mr. Moses Kajwang subjected Wavinya to intensive questioning with the governor stating varying numbers of accounts.
She first stated that the county held 231 accounts and changed the figure to 235. It painted a picture of a CEO who did not know what was going on with county finances. Mr. Kajwang thundered

“That’s a problem. And so, as a CEO, you must make sure that this creep of bank accounts is managed. But since the Governor is appearing before the devolution committee on a similar subject, we shall align ourselves with the directions of the devolution committee.”

The Anchor now reveals a verbatim account of Wavinya’s responses to the committee in this first instalment of her senate appearances.
She was grilled by Mr. Kajwang, Senator Samson Cherergei, Senator Okiya Omtata and Senator Agnes Kavindu Muthama. Wavinya was accompanied by her deputy Francis Mwangangi, Finance Minister Onesmus Kuyu, Finance Chief Officer Mr. Julius Kasanga and County Secretary Dr. Muya Ndambuki, among others.

Wavinya: The M-PESA, I can tell you I found over 200 M-PESA pay bills, I collapsed all of them, I killed all of them. I have two Pay Bill numbers, 1616-1 and 1616-0, 1616-1 is for the hospitals, and the 1616-0 is for the rest of the county.
Cherergei: What about commercial bank accounts, just quickly? Wavinya: Commercial accounts, I have 213 and that is KCB, Cooperative, Equity, and 18 belong to Central Bank of Kenya, but the majority of them are in KCB.
Cherergei: What could be the reason? You have such a huge number of commercial bank accounts outside the facilities accounts that belong to health.
Cherergei: So you want to say 213 all of them belong to health facilities?
Wavinya: can be very clear with that. I can go through the accounts and tell you what they are for. We have with CBK, which is for the recurrent, CBK again.
Cherergei: You are not getting my question, I am saying commercial bank accounts, not the CRF, not the one that belongs to the county treasury, not the one that belongs to special purpose accounts of KSUB, Kenya Urban Support Program or World Bank. I am talking about specifically commercial bank accounts that you have opened… like the way you have said about KCB. So my question is, do all these bank accounts belong to health facilities only or there are others outside health facilities?
Wavinya: Health facility is 178 and outside is 35.
Cherergei: Excluding the CRF at the Central Bank?
Wavinya: Yes.
Cherergei: Why do you need these 35 commercial bank accounts? What is it for?
Wavinya: Can I explain?
Kasanga: The chair through the governor, the rest of the accounts are for the donor funds.
Kasanga: I have said outside special purpose accounts, there are donor funds which are administered through the commercial bank.
Cherergei: But I ask a specific question when I see you that are not part of special purpose accounts. I just want the commercial bank accounts.
Cherergei: I’m hearing you are being told six. He does not seem to believe. He does not believe, and he is the accounting officer under the PFM.
Kasanga: Senator, I think through the governor, I think we have not gotten your question. I think I was indicating that outside the SPAR accounts that are in CBK.
Cherergei: And the commercial bank accounts that are for the health facilities. The rest of the accounts are for the donor. They are donor funds. You are confusing Chief Officer. I have just said outside the CRF that belongs to Central Bank, outside the SPS. Outside the health facilities improvement account. I just want other accounts. Is that more clear?
Wavinya: Chair, can you give us just one minute so that we can give you the information, Please.
Kavindu: And you need to confirm whether there is authority from Treasury on those accounts.
Kasanga: Yes, Senator. Through the governor, there is…. We always open the commercial bank accounts upon advice by the National Treasury.
Cherergei: Chief Officer, how many? You know you are dragging us.
Wavinya: Chair, we are just giving you.
Cherergei: You have reduced
Wavinya: Chair, from 231 now to 235.
Wavinya: Yes.
Cherergei: From 35, how many remains?
Wavinya: Just one, the commercial accounts only.
Cherergei: I think the Chief Officer is feeling hot until he has adjusted his tie.
Wavinya: Senator, through Chair, you just give us one minute, and they will give you that now.
Cherergei: But Governor, I have been watching the clock. It is beyond one minute. You know you have a clock behind you. That is over. It is now exactly a minute that has been spent.
Kajwang: That is why, at the end of the year you have 75 accounts that cannot be reconciled because of the multiplicity of bank accounts.
Senator Omtata: Now, there is the other thing of the controller of budget. When you have got so many accounts, how does the control of budget oversight them? Because the idea is that the control of budget should oversight these accounts. And to me, I understand, technically, under the way the law is crafted, you cannot have more than three accounts. One for the development expenditure, the other one for the current, and one for…And even the facilities improvement fund, the way it has been set up in the Act is unconstitutional. If you read it again, it is the Public Finance Management Act. Just like the SHIF Now, I have challenged the SHIF.
SHIF, that is what I am challenging, but the same way can apply the other side. Because the way SHIF has been set up as a fund is totally in violation of the law. So I think we need to look at that critically because the control of budget must never lose sight of the county funds. And you must have really justification as to why you must have more than those three funds that are available.
Cherergei: Those bank accounts, sorry. And you know, Chair, our worry, and the Governor should list this carefully, is that is how money is being misappropriated. Because I am happy she said there were over 300 M-pesa and she collapsed to two. That is a very justifiable reasoning. Now you can have a view of how money is collected through M-pesa, which is good and efficient. The reason we want to be three SPS, CRF, maybe recurrent and development, is for easy view of even COB and other state organs that oversight.
Kajwang: Members, we need to make some progress. COB, Controller of Budget?.
Controller of Budget (COB): Thank you, Chair. From the controller of budget, we always have a problem with the operating accounts that are not from CBK. And this is contrary to Regulation 82 of the (Public Finance Management) PFM, which requires that all bank accounts are opened and maintained in the CBK. Now, for Machakos County, as per the report from the county, as per last year, they had 29 bank accounts which are outside CBK. Thank you.
Kajwang: And Senator Omtata, the Facility Improvement Financing Act, I had an opportunity to review it at a meeting of the COG. It was very poorly drafted because it makes it mandatory for dispensaries to have bank accounts, for level 2, level 3s to have bank accounts. And there’s one mandatory signatory. I think it’s the sub-county accountant who’s a mandatory signatory for those. So, you’ll find a county with several accounts with the same signatory. It looks very alarming, but it’s the manner in which the law was crafted. So, I hope it can be reviewed.
Kajwang: Governor, please, do you have the numbers or we can proceed and get back to you?
Wavinya: I have the numbers. 188 is hospital.18 is CBK. 9 is donors. 12 is the municipals. I’ve said 188 hospital, 18 CBK, 9 NGOs and donors, and 12 are for the municipals.
Kajwang: Okay, so the reason why we have taken a bit of time is that at the time of audit, the Auditor General says that only 18 bank accounts, that the financial records revealed Kes.1.9 billion related to only 18 bank accounts, but 245 bank accounts with a balance of Kes.225 million were not disclosed in the financial statements. That’s a problem. And so, as a CEO, you must make sure that this creep of bank accounts is managed. But since the Governor is appearing before the devolution committee on a similar subject, we shall align ourselves with the directions of the devolution committee.
To Be continued