A whopping Rwf222 billion used by Non-Budget Agencies (NBAs) in the Financial Year 2014/15 went unaudited, according to the latest Auditor-General’s report.
It is against this background that Transparency International Rwanda (TI) is calling on the Auditor-General to dig deeper.
In an analysis of the Auditor-General’s annual report, Transparency International Rwanda argues that not auditing NBAs hinders proper management of public funds and recommends a systematic auditing of all decentralised entities.
“From this analysis, we see that NBAs transactions account for a huge amount; however, except for limited spot-checks, NBAs are not scrutinised by the Auditor-General and this constitutes a loophole for embezzlement and other forms of corruption,” Apollinaire Mupiganyi, Transparency International Rwanda executive director, said Tuesday while presenting their analysis.
NBAs are entities such as schools, health facilities and sectors, which do not get direct budget allotments from the National Budget but through district funding.
“This calls for reflection and probably come up with a home-grown solution to address this issue to ensure accountability and transparency in NBAs,” Mupiganyi said.
TI-Rwanda chairperson Marie-Immaculée Ingabire said a lot of money was being used by local administrations, schools and health facilities, yet it is not being audited, citing Vision Umurenge Programme (VUP) funds that are provided to vulnerable people under social protection programmes.
“Our analysis shows that without additional resources for internal and external auditing of local government expenditures, without capacity building for district councillors and other budgetary oversight entities and without effective prevention and punitive measures, the expenditure and non-expenditure-related weaknesses detected every year are unlikely to decrease,” she said.
“The analysis reveals that more than 40 per cent of detected fraudulent transactions are linked to VUP social protection scheme, which is supposed to serve as a social safety net for the poor and vulnerable.”
The TI report also showed that Rwf2.3 million was mysteriously paid to non-existent staff.
The Permanent Secretary at the Ministry of Local Government and Social Affairs, Odette Uwamariya, said the watchdog’s analysis of the AG’s report will help reexamine performance, particularly in respect to competency, integrity, and financial discipline that will help the Government take collective measures to check the identified weaknesses.
“We do recognise the challenges in the local government entities, especially the issue of lack of capacity to achieve the desired clean audit that we all want, and with particular emphasis on the non-budget agencies at the moment. But we are fully committed to supporting them, to building their capacities, and to continue to improve so that public funds that come from the taxpayers are appropriately allocated and utilised,” Uwamariya said.
Ezra Gasangwa, the legal advisor at OAG, said that the government had started rolling out an accounting application called Subsidiary Entities Accounting System (SEAS) in all NBAs which will make recording of transactions and reporting to the District easier.
These will also be integrated into the mainstream Integrated Finance Management System so that they can start being recorded.
He said they audited 18 district hospitals in the previous two years, pointing out that this year, they would audit all district hospitals.