This archive report was first published on 8 December 2019.
On December 8, 2019, the Public Accounts Committee (PAC) of Parliament directed the Kenya Commercial Bank (KCB) to provide a breakdown of the annual interest earned by the Ministry of Energy on deposits meant for a donor-funded project.
The directive was made in a report by the PAC, which scrutinized the audited accounts of the National Government for the financial year 2016/17.
According to the report, the Ministry of Energy had deposited funds into the Kenya Energy-Sector Environment and Social Responsibility Programme Fund, which was meant for a donor-funded project.
However, the Ministry of Energy's financial statements showed that the fund had earned an interest income of Sh13.46 million in the year to June 2017.
Former Auditor-General Edward Ouko had flagged this amount, stating that the Ministry of Energy's management had not provided evidence of how the bank computed the interest amount.
Mr. Ouko's audit revealed that the fund had received interest totaling Sh92.62 million from 2007 to 2016, but the Ministry of Energy had not provided evidence of how the bank computed this interest amount.
As a result, Mr. Ouko performed a re-calculation and found that the interest income due to the fund from November 15, 2007, to June 30, 2017, should have been Sh134.5 million, resulting in an underpayment of Sh41.88 million.
Energy Principal Secretary Joseph Njoroge responded to the PAC's concerns, stating that the Ministry of Energy had written to the management of the bank on several occasions seeking an explanation of how the interest amount was computed.
However, the Ministry of Energy's response was that the bank had responded to their queries, stating that the computation of the interest of Sh92.62 million was done in their letters dated December 27, 2018, and May 2, 2019.
