This archive report was first published on 2 July 2021.
Published on July 2, 2021, the Report of the Auditor General for the National Government for 2019-20 financial year has cast a spotlight on the National Treasury's handling of public debt figures.
The Auditor General, Nancy Gathungu, has given an adverse opinion on the financial statements for the Consolidated Fund Services for the financial year to June 2020, indicating that the statements might not give a true reflection of the fund.
Ms Gathungu noted that the Treasury's disclosure of loans taken by the government has been inconsistent, with some instances of new debt not being included. This has led to discrepancies in the total loan balance, which stood at Sh6.37 trillion as of June 30, 2020.
According to the report, the Treasury has tried to explain the discrepancies by citing instances where loans taken during one financial year might not be disbursed until the following year. However, the Auditor General has questioned the accuracy of the reported loan balances.
Public debt currently stands at Sh7.34 trillion and is expected to further grow over the next financial year as the country borrows to plug deficits between expenditure and revenue collection.
The Auditor General's report also highlighted unexplained variances in short-term borrowing balances, with the Treasury's reported balance of Sh887.14 billion as at June 30, 2020, being disputed by the Auditor General.
Former Auditor General Edward Ouko had previously raised issues with the Treasury's accountability on the Eurobond issue of 2014, where the government received Sh250 billion from international investors.
