Busia Senator Okiya Omtatah has accused the World Bank of looking away from Kenya's borrowing problem, Capital FM reported on Tuesday. In a statement, he called the lender's latest corruption assessment a misleading "expose". He said the report targets procurement theft but ignores loans that escape Parliament's control.
Omtatah said spending is only part of the problem. The bigger issue, he argued, lies on the revenue side: loans contracted without matching spending provisions in the Appropriations Acts passed by Parliament. In his view, this weakens oversight and lets public money move outside normal constitutional budget controls. He also accused the bank of complicity. He said its focus on procurement lets it avoid scrutiny of its own lending to Kenya.
The senator named specific laws. He said Sections 3, 4 and 5 of the Bretton Woods Agreements Act, Cap 464, let the National Treasury and the World Bank bypass key accountability steps. Section 4 allows certain payments to the IMF and World Bank to be charged on the Consolidated Fund without further appropriation. Omtatah said this creates a "closed system" of financial governance. He also questioned the immunities the World Bank enjoys under Article VII of its Articles of Agreement. He said they make the lender hard to hold to account.
He also took aim at the Treasury Cabinet Secretary's powers under Section 49 of the Public Finance Management Act. He said the section gives the Cabinet Secretary wide discretion to take local and foreign loans based on the Budget Policy Statement. That statement only guides budget preparation, he argued, and should not replace Parliament's approval of borrowing.
Omtatah further claimed that some budgeted foreign loans are kept in offshore accounts and spent outside Kenya without enough checks by Parliament or the Controller of Budget. He said Section 50(7) of the same Act clashes with Article 206 of the Constitution. That article requires withdrawals from the Consolidated Fund to be lawfully authorised and approved by the Controller of Budget. He also criticised the securitisation of future tax revenue. He warned that funds created this way risk acting like parallel treasuries, with executive-appointed boards that borrow and spend outside normal oversight.
He urged Kenyans to compare any year's Appropriations Act with the Treasury's monthly Statement of Actual Revenue and Net Expenditure Issues. He said the gaps would expose "hidden loans not tied to any projects approved by Parliament".
His comments follow the World Bank's 34th Kenya Economic Update, released on November 4. The report warned that corruption and weak governance were hurting growth, investment and job creation. It estimated that corruption and collusion in public spending and revenue collection cost Kenya up to two percentage points of GDP a year through bigger fiscal deficits. It also linked weak governance to higher borrowing needs.