PAC raises red flag on Ksh1.8B sitting idle in Kenya’s foreign missions
By Joel Masibo, September 12, 2025The Public Accounts Committee (PAC) has raised an alarm over an estimated Ksh 1.8 billion idle at foreign missions.
On Thursday, September 11, 2025, a storm brewed in Parliament after lawmakers demanded answers on why the money remains locked in foreign missions’ accounts, years after being allocated for development projects and embassy operations.
In a statement issued by the Parliament on Friday, September 12, 2025, the issue raised during a Public Accounts Committee (PAC) session centred on funds held in Kenya’s embassies in Washington, Addis Ababa, and London.
The committee, which scrutinised the audited financial statements of the State Department for Foreign Affairs for the year ending June 2023, flagged the matter as a serious accountability lapse. In her audit report, Auditor-General Nancy Gathungu questioned the handling of Kshs 1.8 billion recorded as development cash book balances in missions abroad.
She noted that the funds had accumulated over several years due to the failure to surrender unutilized allocations at the close of each financial year.
However, appearing before the committee chaired by Butere Member of Parliament Tindi Mwale, Principal Secretary, State Department for Foreign Affairs, Dr. Abraham Korir Singoei, defended the more than Ksh1 billion unutilised development funds, saying the money represents development cash flow balances held across various missions and not idle funds.
Dr. Sing’oei said the figure of Ksh1.8 billion had been set aside for specific purposes tied to ongoing projects and mission operations abroad.
“In Washington, D.C., the balance comprises contractors’ retention monies for works already completed and certified, pending the conclusion of the defects liability period before final handover of the project,” he explained.
“It also includes allocations for ongoing refurbishment works. These funds will be transferred to deposit accounts and released directly, hence no need to factor them into the current budget.”
Turning to the London mission, the PS said the monies were earmarked for the purchase of a Chancery property.
He noted that while the property had been identified and the procurement process finalised, the funds could not be spent because the Attorney General had not yet given concurrence for the procurement of a conveyancing lawyer to prepare the necessary documentation.
“Since the process was already at an advanced stage, the funds were retained and transferred to the mission’s deposit account, awaiting final execution of the sale agreement,” Dr. Sing’oei told MPs.
He further revealed that part of the London balance was generated locally through consular services and retained to supplement Exchequer funding for operating costs.
These funds were later regularised under Supplementary Estimate No. 2 of FY 2023/24, allowing the mission to utilise them lawfully.
Dr. Sing’oei acknowledged that some missions had failed to transfer their development fund balances into deposit accounts by the close of the financial year but assured the committee that instructions had since been issued to enforce compliance.
“Going forward, such balances will be placed into deposit accounts, from where payments will be effected for completed works, certified and billed, or for property acquisitions, as in the London case,” he said.
The PS emphasised that the funds were secure and aligned to development priorities, dismissing concerns of mismanagement or budgetary irregularities.
However, legislators accused the Ministry of Foreign Affairs of failing to account for the funds, sparking concerns over financial discipline and the fate of critical diplomatic projects.
Rarieda Member of Parliament Otiende Amollo expressed concern over prolonged delays in the purchase of Kenya’s Chancery property in London, despite funds having been allocated years ago.
Amollo reminded officials from the Ministry of Foreign Affairs that it was the committee itself that first flagged the matter after discovering the London mission was operating on an expired lease.
“We recommended that the property be purchased. The sequence of events is clear: first, the identification of the need, which the committee agreed with; second, the request for funds, which were provided; and third, the procurement, which was completed,” he said.
The legislator explained that while no legal input was required during procurement, conveyancing, because it involves a foreign jurisdiction, must be handled by a local practitioner in the UK.
“If it were in Kenya, the process could easily have been handled internally. But in a foreign country, the services of a conveyancing lawyer are necessary,” he added.
Amollo questioned why, despite Ksh1.669 billion having been allocated for the London development in the 2022/2023 financial year, the funds remain idle. “Everything else has been completed, yet we are told the delay is due to a pending letter from the Attorney General,” he said.
The MP pressed the Ministry to produce evidence of requests made to the AG, warning that the committee could not accept a situation where money is left unused for three or four years over what he termed “one of the simplest and least costly undertakings.
Dr. Sing’oei explained that under Regulation 56 of the Public Finance Management Regulations, an accounting officer is empowered to retain resources for multi-year contracts without necessarily returning the funds to the National Treasury.
He insisted that this is why some of the money is still being held in various accounts.
“We are permitted to hold deposits beyond a financial year. As I had earlier informed this committee, Regulation 56 of the Public Finance Management Regulations allows us to do so in respect of development projects that are multi-year in nature. This provision applies where the resources budgeted by the National Treasury cannot be fully utilised within a single financial year,” he said.
PAC further pressed the ministry to break down the KSh1.885 billion across the missions, accusing officials of offering blanket explanations without clear apportionment.