Contractors and suppliers owed over Sh100 billion by county governments could finally get paid after the National Treasury waded into the pending bills issue.
In a notice placed in the dailies Tuesday, the Auditor-General’s office said it had been instructed by the Treasury to ‘urgently’ verify claims and report back by the end of January 2019.
“We notify all suppliers/contractors of goods, services and works with outstanding claims as at June 30,2018 to present their claims to the County Executive Committee-Finance at their respective county governments by December 31,” it said.
The Auditor-General notice said each claim must be accompanied by documents notifying the private businesses of the contract award, a letter of acceptance, commencement of works, local purchase orders, local service orders, contract documents, delivery notes, goods delivery notes and service delivery notes.
Where applicable, statement of accounts (civil works), joint measurement (roads), payment certificate and details of any payment made on account and any other relevant documents should be included to prove the claims.
The new directive risks throwing into disarray ongoing works by audit teams formed within county governments to scrutinise the payments mostly associated with past regimes.
In an earlier dispatch, Treasury Secretary Henry Rotich blamed new governors for stalling settlement of the bills incurred during the tenure of former governors.
Banks have complained over delays to settle the contractor and supplier claims estimated at Sh100 billion saying their business of lending to small and medium enterprises had been hit hard.
The banks gave out loans on the strength of local purchase orders given out to SMEs to provide various goods and services to county governments only to wait for long to be repaid. This saw expected profits for SMEs wiped out since bank interests and penalty fees were lumped on the loans.
Mr Rotich said the Treasury was mulling over a new public procurement strategy where new regulation will be introduced capping the payment period at 60 days upon presentation of the payment demand by the contractors and suppliers.
He said bureaucracy in public offices had derailed genuine businesses while perpetrating graft that made implementation of projects costly.