Controller of Budget Margaret Nyakang’o has exposed how some counties are spending millions without seeking approval from her office, while others deliberately overshoot their spending beyond the approved limit.

This is even as some counties seek funds only to keep it idle in their accounts, thus being unable to implement their planned programmes and projects.

In the revelation that lifts the lid on how taxpayers could be losing billions in the devolved units, Nyakang’o revealed that out of the 47 county governments, 16 of them spent beyond their approved expenditures, clearly defying the OCOB mandated to approve spending limits by the counties.

The revelations are contained in the COB’s report on county expenditure for the first half of the financial year 2024-25, released last week.

In the report, Nyakang’o revealed that some counties are diverting funds approved for specific programmes and budget lines to other uses in total disregard of the law and institutions.

For instance the Bungoma Executive spent Sh5.12 billion against Sh4.72 billion approved by COB, translating to 109 percent of its approved spending, followed by Homa Bay which spent Sh4.37 billion against Sh4.25 billion (103 per cent).

Kilifi indulged itself with some Sh6.13 billion against Sh5.11 billion (120 per cent), its coastal neighbour Kwale spent Sh4.65 billion instead of Sh4.08 billion (114 per cent) while the Wavinya Ndeti-led Machakos County splurged a cool Sh5.97 billion instead of Sh4.77 billion (125 percent) respectively.

The report further shows that Samburu County spent Sh2.36 billion instead of Sh2.34 billion (101 per cent), Turkana Sh6.62 billion out of approved budget of Sh5.37 billion (123 per cent), Uasin Gishu Sh4.74 billion instead of Sh4.22 billion (112 per cent) and Wajir spent Sh4.76 billion instead of Sh4.10 billion (116 per cent) respectively.

In addition, the report further revealed that Makueni (138 per cent), Meru (104 per cent), Migori (108 per cent) and Nandi (120 per cent), Narok (105 per cent), Nyandarua (122 per cent) and Nyeri (108 per cent).

 “Analysis of expenditure against exchequer issues shows that the County does not adhere to the exchequer requisitions work plans during expenditure, leading to the diversion of funds across departments,” reads part of the report.

The report further adds that Kilifi County had over-expenditure above the exchequer releases in the departments of County Executive, Water, Environment and Natural Resources, Health Services, Agriculture, Crop Production and Irrigation, Education, Culture and Social Services and Youth and Sports.

Nyakang’o said although the approved requests for withdrawals from the relevant county revenue funds are well supported, the Controller of Budget has noted frequent non-adherence to the exchequer work plans by county governments.

“The devolved units are exploiting the manual exchequer process (process of managing and controlling finances) to divert funds approved for some budget lines to other uses. Given that the exchequer process is mainly manual, it is challenging to tie approved requests and supporting work plans to actual expenditures,” the report reads in part.

“The County reported that expenditures in some departments exceeded the amounts released by the exchequer. This situation arose due to the diversion of funds from the exchequer work plans submitted to the OCOB,” the report states about Kakamega County.

This even as the total expenditure by County Governments in the first half of financial year 2024/25 was Sh181.86 billion, representing an absorption rate of 31 per cent of the total annual County Government budget.

The expenditure comprised Sh151.26 billion for recurrent expenses and Sh33.60 billion for development expenses, representing 18 per cent of the total expenditure during the review period.

According to Nyakang’o, the overspending by the counties implies that the devolved units did not bank all their revenues (spent at source) before seeking requisitions in her office.

“It is illegal and dangerous as far as the management of public funds is concerned. The law requires the counties to bank all the monies they receive. After that, they are supposed to make requisitions to my office for the withdrawal of that money,” said Nyakang’o.

She went on: “It is a legal requirement for accountability because we know what has come in and what has gone out and for what reasons.”

In what is emerging as a clear trend, most counties are diverting funds meant for payment of pending bills, leading to massive accumulation of debts.

“Several County Governments did not adhere to their submitted plans while paying pending bills,” said Nyakang’o.

As at December 31, last year, the counties had accumulated pending bills amounting to Sh182.13billion.

The report shows that only seven devolved counties adhered to the law as they spent strictly 100 per cent of their approved requests by COB.

They include Nairobi, Lamu Embu, West Pokot, Taita Taveta, Mandera and Kitui.

The rest of the counties had billions lying in their accounts that they had spent less than the approved for withdrawal by the COB. The report shows that Busia had only 69 per cent of its total approved requisitions, followed by Tana River at 83 per cent, Kericho at 84 per cent and Vihiga at 86 per cent respectively.

Article 228 (4) of the Constitution and Section 5 of the Controller of Budget (COB) Act, 2016, provides guidelines for approval to withdraw funds from the County Revenue Funds.