A recent audit of Kenya’s public debt management system, conducted by Auditor General Nancy Gathungu, has uncovered significant weaknesses that compromise data security and the reliability of the country’s loan-related records. The audit revealed discrepancies between the closing balances reported in the Annual Debt Management Report and those in the External Public Debt Register, indicating a lack of coordination within the Public Debt Management Office (PDMO). These inefficiencies expose the system to risks such as unauthorized access, operational disruptions, data breaches, and financial losses.
The audit also highlighted that the PDMO does not test its backup plans, leaving it vulnerable to disasters, data loss, and loss of trust from lenders. Security concerns were raised over insufficient protection for databases and servers, increasing the potential for unauthorized access and tampering. Moreover, the Treasury’s debt office was unable to provide evidence supporting the accuracy of public debt records, leading to concerns about unverifiable debt balances.
The audit also pointed out inefficiencies in the utilization of loan proceeds for public projects, with examples like a clinical waste disposal machine at Port Reits sub-county Hospital that remained out of service due to electricity issues, resulting in a failure to realize the full benefits of borrowed funds.