The Kenya Wildlife Service diverted Sh2.735 billion meant for environmental restoration to pay salaries and allowances without approval.
Auditor General Edward Ouko, in his 2015-16 report, says the agency received the cash as compensation for 153 acres hived off the Nairobi National Park for the construction of the Southern Bypass and the standard gauge railway.
The KWS was allocated Sh5.2 billion for compensation.
Ouko says KWS diverted the funds to recurrent expenditure without approval from the National Treasury, contrary to the Public Finance Management Act.
Under the Public Finance Management Act, state-owned institutions must seek approval from the National Treasury before diverting funds allocated for particular activities.
The KWS is among a number of state agencies flagged by Ouko. The Auditor General says its financial statements do not paint a true picture of its financial position, performance and cash flows for the probed financial year.
The KWS received Sh1.469 billion for the 100 acres of the park that it ceded for a section of the standard gauge railway.
The amount was Sh6 million short of the allocated Sh1.475 billion that was to be paid to KWS.
Ouko says the deficit was not explained during his audit of the state agency.
While the KWS was also to receive Sh3.74 billion for the 53 acres used to build part of the Southern Bypass, the agency only received Sh1.266 billion in the 2015-16 financial year, less than half of the compensation package.
No explanation for the Sh2.474 billion deficit for the Southern Bypass section was given.
The money was to be deposited in the Wildlife Endorsement Fund. The kitty was set up in 2010 to fund KWS’s wildlife management and environmental conservation activities.
“The money was meant for environmental restoration but due to huge underfunding of its operational activities, the service used the funds under its recurrent expenditure,” the report says.
The Southern Bypass section hived off the Nairobi National Park is a four-kilometre stretch from the Ole Sereni junction off Mombasa Road, to the Carnivore junction in Lang’ata.
There is still an objection to construction of the standard gauge railway cutting across the park. The suit was filed by activist Okiya Omtatah. Construction has however started.
The decision to allow the two projects to cut through Kenya’s oldest game sanctuary caused uproar from activists and residents, who argued the move could interfere with animal life.
Ouko said the Wildlife Endorsement Fund had not been fully set up by the time he was probing the KWS books for the 2015-16 fiscal year. His report faults the management over record keeping for the fund.
“Apparently, management does not maintain proper records for the fund, and as a result the accuracy and completeness of the Endorsement Fund balance of Sh67,504,000 as at June 30, 2016 cannot be confirmed,” Ouko said.