Hiiraan Online

A Somali woman displays her Baxnaano program identification card outside her hut, as children look on, in a rural village. The World Bank–financed cash transfer scheme, implemented through the Ministry of Labour and Social Affairs with support from the U.N. World Food Programme, is Somalia’s flagship social protection program. (Baxnaano photo)

Mogadishu (HOL) —Somalia’s auditor general has raised red flags over more than $153.8 million in social spending under the World Bank–financed Baxnaano program could not be independently verified. The report cited a lack of beneficiary records from the U.N. World Food Programme, which managed the disbursements.

The Baxnaano program, Somalia’s flagship cash-transfer initiative funded by the World Bank, was singled out as a key audit matter. The initiative is a centerpiece of the country’s social safety net and heavily backed by international donors.

Auditors said the absence of verifiable data from WFP raised concerns for public trust and donor confidence.

In its annual audit for 2024, the Office of the Auditor General (OAGS) issued a qualified opinion on the federal government’s accounts, highlighting accountability gaps in two critical areas: social protection spending and concession revenues.

The audit said the government reported $32.2 million in revenue from concession contracts at Mogadishu’s port and Aden Adde International Airport. Under the agreements, the government is entitled to 62.17 percent of port revenues from Mogadishu Alport Corporation (Albayrak-Somalia) and 25 percent of airport revenues from Favori LLC. But neither company submitted audited financial statements as required, leaving auditors unable to verify whether the government received its full share.

The report also revealed that six government entities received $5 million in off-budget donor grants during the year, while annexes listed another $9.4 million in donor funds. None were reflected in the official financial statements, a violation of Somalia’s Public Financial Management Act and international standards. Auditors further criticized incomplete explanations for significant variances between budgeted and actual spending.

Auditors raised further concerns over budget-to-actual reporting, saying ministries failed to provide explanations for significant variances, as mandated under international standards. Weaknesses were also identified in legal compliance, IT system controls, and management of donor-funded projects.

Auditor General Ahmed Isse Gutale pledged continued engagement with ministries, agencies, and development partners to close gaps in financial reporting. The findings are expected to spur debate in parliament and among donors as Somalia deepens fiscal reforms.