The Cabinet Secretary for the National Treasury and Economic Planning, John Mbadi, on Thursday, July 17, 2025, approved the proposed new system to stop governors from stealing county funds.
“The Cabinet Secretary for the National Treasury and Economic Planning, Hon. John Mbadi, has assured the Senate that his Ministry is doing all it can to enhance accountability and transparency in the use of public resources,” read part of the parliamentary report.
Controller of Budget Flags 1,854 Illegal Bank Accounts
This comes after a report by the Controller of Budget revealed that counties are operating 1,854 commercial bank accounts against the Public Finance Management Regulations of 2015, raising serious concerns over possible misuse of funds.
The Controller of Budget submitted the County Budget Implementation Review Report to the Senate in line with constitutional requirements.
The report noted that the high number of bank accounts makes it difficult to track how counties are spending money, creating room for fraud and mismanagement.
Mbadi says TSA to Improve Financial Oversight
CS Mbadi told the Mohamed Abbas-led committee that the Cabinet has already approved the rollout of the Treasury Single Account, which he described as a major reform in public finance management.
“Implementation of this policy is part of the broader Treasury Single Account action plan, which is expected to improve financial governance and control over/share of public funds,” Mbadi said.
“The primary goal of the policy is to ensure accountability and transparency in the use of public resources,” he added.
TSA is a financial system that consolidates all government revenues, receipts, and income into a single account, usually maintained at the Central Bank of Kenya.
This setup is designed to improve oversight and reduce misuse of funds by eliminating scattered and unmonitored accounts.
Senators Demand County-Level Inclusion in Reforms
The former Suba South MP expressed confidence that the move would strengthen Kenya’s fight against financial mismanagement in both national and county governments.
Members of the Senate Committee called on Mbadi to engage the Council of Governors (CoG) and the Senate Standing Committee on Finance and Budget to craft a joint TSA policy that meets the needs of both levels of government.
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Senators also asked the Treasury to create a hybrid system that allows visibility into county accounts without directly accessing the money.
“Hon. Mbadi, your ministry needs to review the existing regulations to provide clarity on the requirements for county governments to open commercial bank accounts and explore options to compel full disclosure of all accounts,” Senator Mohamed Abbas, the committee chairperson, said.
Auditor General Warns Against Multiple Accounts
This comes months after Auditor General Nancy Gathungu raised alarm on the large number of accounts managed by counties, which she says complicates oversight and tracking of public funds.
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Speaking before the Senate Committee on County Public Investment and Special Funds on September 4, 2024, Gathungu said counties should reduce the number of accounts they manage.
“We should minimise bank accounts. We need one or two revenue or expenditure accounts. We don’t need 300. First, you lose track of funds,” she warned.
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