The National Assembly has moved to investigate fuel levy collections by the Kenya Roads Board after reports showed discrepancies in fund allocations and pending payments.
Legislators want a forensic audit to clarify revenue flows and ensure funds reach the intended road agencies.
The Public Investment Committee on Commercial and Energy Affairs instructed the Auditor-General to examine fuel levy revenue for the financial years 2020/21 to 2022/23.
The audit will verify the amounts collected by the Kenya Revenue Authority (KRA), disbursed to the Kenya Roads Board, and eventually transferred to the relevant road agencies.
Auditor-General Nancy Gathungu had highlighted gaps in the Road Maintenance Levy Fund, noting that receivables from non-exchange transactions totalled 5.53 billion shillings. Grants owed by the Kenya Roads Board stood at 5.08 billion shillings.
“However, the audited financial statements of the Kenya Roads Board reflect Road Maintenance Levy Fund (RMLF) disbursement payable to Kenya Urban Roads Authority balance of Sh2,322,321,695 resulting in a variance of Sh2,755,302,399, which was not explained or reconciled,” Gathungu said.
“In the circumstances, the completeness and accuracy of grant receivables amounting to Sh5,177,634,094 could not be confirmed.”
During a committee sitting chaired by Pokot South MP David Pkosing, Kenya Urban Roads Authority Director-General Silas Kinoti said the grants of 5,177,634,094 shillings had been correctly recorded and received at the start of the 2022/23 financial year.
“The committee directs the Auditor-General to carry out a forensic audit on the revenue generated by the Kenya Roads Board from the fuel levy for the financial years 2020/21 to 2022/23,” Pkosing said.
“Further, the forensic audit should confirm the amount that the Kenya Revenue Authority collected and disbursed to the roads board and the amount that was disbursed to agencies in relation to fuel levy for the stated period.”
The panel also requested Kinoti to provide a detailed update on the intended securitisation of the Road Maintenance Levy Fund and progress in clearing pending bills within three months of the report’s adoption.
The committee noted that KURA’s outstanding bills had grown substantially.
Gathungu revealed that payables from exchange transactions totalled 15.4 billion shillings, with 14.18 billion in current liabilities and 1.18 billion in non-current obligations, including 14.15 billion owed to suppliers and contractors.
“The total balance as at June 30, 2022, when compared to Sh12.28 billion reflected in the financial statement for the period ended June 30, 2021, shows an increase of Sh3.078 billion or 25 per cent. This exposed the authority to unnecessary and avoidable costs of claims of interest and penalties on late payments to contractors on various projects,” Pkosing added.
The rise in pending bills, he warned, could affect KURA’s operations and cash flow.