Operations in 15 counties are in imminent danger of grinding to a halt after the National Treasury announced that it will not disburse funds to the devolved units over their failure to pay pending bills owed to suppliers and contractors.
The directive, which comes into effect on December 1, is meant to free Sh147.3 billion which county governments and national government entities owe suppliers and contractors.
“I am taking this move to ensure that the common man is paid for supplying goods and services. We should not have a situation of the public complaining that money is not flowing in the economy, yet there are billions of shillings locked by financial institutions,” acting National Treasury Cabinet Secretary Ukur Yatani said.
As part of ongoing reforms meant to restore confidence in the economy and increase the money in circulation in the economy, Mr Yatani also announced that the government will stop sending money to 53 national government departments that have also not shown any effort to clear pending bills.
County governments have eligible pending bills amounting to Sh51.2 billion while national government departments and agencies owe suppliers and contractors Sh96.1 billion, according to the National Treasury.
“As a responsible government, we owe a duty of care to businesspeople who continue to suffer because they have not been paid for works done and services delivered. We cannot continue to see our people suffer in the hands of county and national government agencies that don’t want to pay for what they have consumed,” the CS said.
The 15 counties whose disbursement will be stopped are Narok, Machakos, Nairobi, Vihiga, Isiolo, Tana River, Migori, Tharaka-Nithi, Bomet, Kirinyaga, Nandi, Mombasa, Kiambu, Garissa and Baringo.
After dealing with the 15 counties, Mr Yatani announced that the same action will be carried out on 20 counties that have “demonstrated some efforts towards payments of their pending bills though are yet to fully comply.”
The counties that have partially complied with the pending bills order are Taita-Taveta, Turkana, Kisumu, Meru, Samburu, Nakuru, Murang’a, Mandera, Kisii, Busia, Marsabit, Bungoma, Siaya, Transnzoia, Kitui, West Pokot, Embu, Kakamega, Wajir and Embu.
In a press conference Tuesday, the CS applauded the counties of Elgeyo Marakwet, Homabay, Kajiado, Kericho, Kilifi, Kwale, Laikipia, Makueni, Nyamira, Nyandarua, Nyeri and Uasin Gishu for clearing all their eligible pending bills.