1. BUDGETING PROCESS: IMPLEMENTATION FOLLOW-UP OF PUBLIC ACCOUNTS COMMITTEE AND AUDITOR GENERAL RECOMMENDATIONS PRESENTED BY HON. ALEX MWIRU, MP PUBLIC ACCOUNTS COMMITTEE – KENYA

2. INTRODUCTION The promulgation of the Constitution of Kenya in August 2010 marked a very significant step in advancing the principles of governance as articulated under Article 10 of the Constitution. It encompasses sharing and devolution of power, practice of the rule of law, exercise of democracy and participation of the people, high levels of integrity, increased transparency and accountability in public service delivery for sustainable national development and economic growth.

3. INTRODUCTION Parliament being the central oversight organ no doubt holds the key to well functioning democracies by ensuring accountability in the management of public funds and resources. Parliamentarians therefore need to play an effective role in developing comprehensive national policies to ensure good governance and stem corruption.

4. PARLIAMENTARY INPUT IN THE BUDGET PROCESS National budgets are public financial management instruments reflecting government policies, priorities, planning and implementation for delivery of public goods and services. Budgets therefore:  Reflects citizens aspirations and priorities in appropriating funds;  Evaluate programs and review the activities of government departments.

5.  Serve as a tool for development, management and economic growth.  Reflect government policies and set national priorities.  They are systems of accountability and control over government officials, ministries and departments, setting expenditure limits and safeguarding against abuse of public funds.  As political tools, budgets are value ridden signaling the government’s ideological commitment, political philosophy and policy platform. In Kenya, the new Constitution puts Parliament at the centre of the budget making process. This is a complete departure from the previous system where the budget making was a domain of the Executive and Parliament only came to learn of the budgetary proposals on the National Budget Day together with the rest of the citizens.

6. According to Article 221 (i) of the Constitution, the Cabinet Secretary in charge of Finance is required to submit to the National Assembly estimates of revenue and expenditure of the national government for the next financial year at least two months before the end of each financial year. These estimates, together with those of the Parliamentary Service Commission and the Judiciary would then be considered by the Budget Committee which makes recommendation to the Assembly.

7. In discussing and reviewing the estimates, the Budget Committee will have engaged with all the line Ministries through the various Departmental Committees. The Budget Committee also seeks views from the people through public hearings some of which are taken on board when Committees make recommendations to the National Assembly. On adoption of the recommendations, they are then considered by Treasury as the Minister propose the final Budget with various amendments and reallocations.

8. Finally, the budget is presented in Parliament as Appropriation Bill. This entire process therefore benefits greatly as it is enriched by both the parliamentary and public input. The process further enhances a sense of ownership, creates awareness of government programmes and draws focus on the needs and aspirations of the citizens at the grassroots level, besides promoting public audit of government programmes among others.

9. IMPLEMENTATION OF PUBLIC ACCOUNTS COMMITTEE AND AUDITOR GENERAL RECOMMENDATIONS Parliamentary Committees perform functions for which Parliament in its corporate capacity is not well fitted to perform. These include examining witnesses, sifting through information and drawing up reasonable conclusions. The Committee system is key to any parliamentary democracy and it strives to achieve effective surveillance over the Executive. Parliament has a moral responsibility as custodian of public funds to assure the citizens that their tax money and other public resources are well- managed by the Executive, and in the most efficient, transparent and prudent manner.

10. The Public Accounts Committee of Kenya is mandated by Standing Order No. 187 to examine audited accounts of government ministries and departments and make recommendations on the utilization of the sums voted by the House to meet public expenditure. In executing this mandate, the Committee examines the annual audit reports of the Auditor General who is the supreme auditor of public funds. Accounting Officers and other government officials are then summoned by the Committee to answer to audit queries relating to expenditures in their respective ministries. Such hearings are open to the public and the media. Thereafter, the Committee develops its recommendations and tables its report in Parliament for debate and adoption.

11. The Executive is then required to implement those recommendations and report back to Parliament through a Treasury Memorandum detailing implementation status within sixty days. The Public Accounts Committee and Parliament in general calling on the Executive to account and implement those recommendations does not entail giving instructions to the Government. The Executive arm of government takes its time and does not feel obligated to move with speed as Parliament would wish.

12. CHALLENGES Some of the challenges faced by the Public Accounts Committee therefore include: Lack of political will to conclusively implement Committee recommendations, particularly those that entail intense investigations and prosecution. Political polarization in government circles and party patronage which generally undermines the fight against corruption by entertaining compromises. Lack of focused and coordinated effort against corruption by watchdog and other anti-corruption agencies.

13. Lack of formal and legally established follow-up mechanisms by the Public Accounts Committee outside the Treasury Memorandum which the Government treats casually as there are no immediate sanctions Parliament can impose. Although the Auditor General acts as the technical arm of the Committee and participates in the report-writing process, his role is limited to following up and reporting whether the same or similar queries are repeated or if any remedial action had been taken during the following year’s reporting. He can however conduct further investigations and establish the extent of the implementation of the recommendations of previous years’ reports. The observations can then be part of subsequent reports. Due to lack of capacity and time constraints, it has not always been possible for the Auditor General to physically verify and adequately confirm that the issues responded to as having been implemented by the Executive through the Treasury Memorandum have been so implemented and satisfactorily.

14. Public Accounts Committees deal with post- mortem scrutiny of government expenditure. This does not help much in terms of prevention of possible misappropriation of funds by public officers entrusted with their custody. The Executive inordinately takes too long to implement Committee recommendations. As a result, some public officers tend to misappropriate funds entrusted to them since there are no prompt punitive measures taken against them to deter recurrence of such incidents. Like most parliamentary committees, Public Accounts Committee is not adequately financed to enable it address its mandate adequately.

15. PROGRESS MADE The Kenya National Assembly has established a Committee on Implementation. Its mandate includes scrutiny of resolutions of the House including adopted Committee reports, petitions and the undertakings given by the Government on the floor of the House and examine:- a)Whether or not such decisions and undertakings have been implemented, the extent to which they have been implemented, and whether such implementation has taken place within the minimum time necessary. b)Whether or not legislation passed by the House has been operationalized, the extent to which such operationalization has taken place and within the minimum time necessary

16. c)The Committee is further mandated to propose sanctions to the House on any Minister who fails to implement resolutions of the House. Since its establishment two years ago, the Committee on Implementation has managed to pursue the implementation of various committee recommendations as well as undertakings given by Ministers on the floor of the House. The Committee is however faced with many issues to handle as it has to deal with both the old recommendations and resolutions as well as the emerging and current ones forwarded to it by all the other Parliamentary Committees.

17. Lack of adequate budget to pursue issues that require physical visits as resolutions and assurances are quite many. Apart from the usual financial constraints, it is also faced with staffing shortfalls, to enable it adequately handle all the issues at stake. The efforts of this Committee have however seen the reopening of two major factories which had closed doors leading to the loss of hundreds of jobs.

18. CONCLUSION The combined efforts of the Public Accounts Committee and the Auditor General are crucial in enhancing accountability, transparency and good management of the scarce public financial resources. It is critical that the two bodies pay special attention to areas prone to systemic financial leakages through impropriety, fraud and corruption. They should insist on automation of financial records and reports as well as improve frequency of reporting by coming up with quarterly reports to foster prompt implementation.

19. In order to improve financial oversight in governance, Public Accounts Committee, as well as other watchdog committees will need to demand of the Executive increased accountability, integrity and good governance across all public sector institutions. They should demand that the Executive deliberates on national commitments and educate the public on its civic duties in order to promote a culture of national integrity and ethics.

20. “There is prosperity in Transparency and Accountability but there is more of the same in positive cultural and attitude change, especially when we owe it in reciprocative trust between us and the people we represent” I THANK YOU