Sunday, May 10, 2009



May 9 2009

Treasury is on Sunday expected to officially invite the Criminal Investigations Department (CID) to probe what initial investigations indicate was internal sabotage of the national Budget books.

It now emerges that senior Treasury officials have confessed to being aware of the Sh9.2 billion mistake well before the printing was done.

That has spawned a school of thought in some circles that sabotage was at work, rather than unintended technical errors.

At the same time, highly-placed Treasury sources, who cannot be named without compromising what could end up as criminal prosecution, indicated that besides the CID, National Security Intelligence Service (NSIS) operatives are already on the case.

Additional spending

The poser over how last year’s Budget spending figures — a column that is forever fixed — were altered in the Supplementary Budget has absorbed the country for the last one week even as Parliamentary Speaker Kennedy Marende ordered a committee inquiry over the matter.

Lines affected in the recurrent estimates errors largely cover personal allowances for State personnel.

The supplementary Budget details additional spending over the main Budget, in this case for the 2008/2009 document.

“We are not convinced that an IT system used in the past three years could have made the mistake. We think this is deliberate interference with the data by our own staff,” said a well-placed official.

The controversy has delayed critical spending including some with security implications like Kazi kwa Vijana, a labour-intensive work programme seen as a bulwark against youth unemployment. Parliament approves all spending.

The Sunday Nation understands that the Treasury PS is today likely to meet Police Commissioner Hussein Ali with a written brief on the saga.


According to officials we talked to, there is lingering suspicion that the matter has much to do with battle for succession at a critical department within Treasury.

A senior official here is reported to have admitted knowing the error but, in his defence, says the IT department had given assurance that it was of no consequence given the new (Supplementary) figures were correct.

What is in contention is how figures passed by Parliament under the national Budget last June were altered while that column is supposed to be constant or, in computing terms, locked.

According to our sources, the matter was discussed among some Treasury officials without bringing it to the attention of the director of Budget Paul Ngugi.

In a matter of days, the issue was raised by lobbyists Mars Group and brought to Parliament by Central Imenti Member Gitobu Imanyara. Indeed, Mars claimed it had sought clarification over the matter without any response.

Finance minister Uhuru Kenyatta’s attempt at explaining the matter fell flat as it failed to admit that actual alteration had been made and instead rubbished Mr Imanyara’s claims.
Apparently, he was counting on the fact that the Supplementary Appropriation Bill, 2009, which spells out the changes in expenditure, was intact and correct. The bill normally explains the new expenditure the State is seeking and was published in a Gazette supplement on April 30, 2009.

On Saturday, Mars Group head Mwalimu Mati was reluctant to make a comment on the CID issue, saying he was a witness who had already appeared before the committee.

Sunday Nation: Do you believe there was deliberate mischief at high level at the Treasury.

Mr Mati: “I don’t know. I don’t know. All I know is that the document had glaring errors which need to be rectified.”

Parliament is expected to get feedback on the matter from the Finance committee on Tuesday. However, Mars Group had earlier classified the Sh9.2 billion discrepancy, mainly in the Education ministry vote, as “looting the Budget”.

This is the first time in the history of the country that such a mistake has been publicly noticed — which may not necessarily mean that it has never happened before, given the low scrutiny the Budget has been subjected to.

A committee composed of Treasury and technology arm, Government Information Technology Services, officials began the investigations after the allegations were made in Parliament.