The Tourism Fund’s financial position came under renewed scrutiny after it emerged that the agency disbursed KSh250 million for the refurbishment of Bomas of Kenya in May 2025 without a formal agreement, despite the institution falling under a different ministry at the time. The Auditor General also flagged inconsistencies in the budget classification used for the payment.
Separate financial records from the same period further show the Fund reported KSh500 million in grants to Bomas of Kenya, nearly twice the amount examined by the Auditor General, without clarifying what the additional funds catered for or whether the expenditure delivered value.
The questioned transfer forms part of a broader financial strain facing the state agency tasked with financing tourism infrastructure, whose cash reserves plunged from KSh374 million to KSh72 million within a year.
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Despite the shrinking cash position, the Tourism Fund still closed the year with KSh1.46 billion in pending bills, the bulk of which are linked to the long-delayed Ronald Ngala Utalii College project.
Construction of the tourism training institution began in 2013 under a KSh8.96 billion contract and was initially expected to be completed by 2018. More than a decade later, the project remains incomplete, with certified costs having surged to over KSh14.4 billion.
The Auditor General noted that prolonged delays have already affected sections of the site, with reports of mould growth and structural cracks raising concerns over the quality and durability of completed works.
Consultants involved in the project have also accumulated KSh2.28 billion in interest penalties, which the Tourism Fund attributed to delayed disbursements from the National Treasury. The Auditor General warned that continued funding delays could trigger further cost escalation through additional penalties and interest charges that have not been factored into current budgets.
The Bomas disbursement and the ballooning Utalii College costs together point to wider governance and financing weaknesses, where spending appears to outpace oversight mechanisms and projects expand beyond sustainable funding plans. The Auditor General stated that several expenditures lacked sufficient evidence to confirm value for money.
The Fund is also grappling with management gaps. It has been operating without a substantive chief executive, relying on an acting office holder. Seven staff positions are currently occupied in acting capacity beyond the six-month legal threshold, while 22 temporary employees have remained in office for more than a year. The last governance audit at the institution was conducted in 2016, leaving nearly ten years without a formal institutional review.